GLYPH INTERNATIONAL LTD. Vs. COMMISSIONER OF CENTRAL EXCISE

JUDGEMENT

(1.) THE facts leading to this appeal are, in brief, as under: -

(2.) 1.1 The appellant are a 100% Export Oriented Unit located in a Software Technology Park and are engaged in development of software for export. For development of software, they require a number of duty paid inputs and input services. The appellant from time to time filed rebate claims for rebate of service tax paid on input services and excise duty paid on duty paid inputs which were used in the development of software, which was exported out of India. The rebate claims are filed in terms of the provisions of Rule 5 of the Export of Service Rules read with Notification No. -S.T., dated 19 -4 -2005. One of the conditions for grant of rebate under this notification is that no Cenvat credit should have been availed in respect of which rebate claim has been filed. The rebate claim for an amount of Rs. 3,52,360/ - filed by the appellant for the period from October, 2010 to December, 2010 was rejected by the jurisdictional Asstt. Commissioner vide order -in -original dated 31 -1 -2012 on the ground that the appellant have not satisfied the conditions regarding non -availment of Cenvat credit in respect of input or input services, as the perusal of the ST -3 Returns for October, 2010 to March, 2011 period filed by the appellant reveals that during this period, the appellant have availed input/input service Cenvat credit and have also utilized the same. In course of proceedings before the Asstt. Commissioner, the appellant pleaded that they have not availed input or input service Cenvat credit, that the figures regarding availment and utilization of Cenvat credit in the ST -3 returns are in fact the figures of rebate, which by mistake had been mentioned in the column relating to availment of Cenvat credit, but this plea was not accepted by the Asstt. Commissioner. On appeal being filed before the Commissioner (Appeals), their appeal was dismissed vide order -in -appeal dated 27 -2 -2012. In course of appeal before the Commissioner (Appeals), the appellant produced a Chartered Accountant's certificate certifying that no input/input service Cenvat credit had been taken but this plea was not accepted by the Commissioner (Appeals). The Commissioner (Appeals) also rejected the rebate claim on an additional ground not mentioned in the order -in -original which was that inputs/input services, in question, in respect of which the rebate claim has been filed, were not used in providing the taxable service exported by the appellant. Against this order of the Commissioner (Appeals), this appeal has been filed.

(3.) I have considered the submissions from both the sides and perused the records. There is no dispute about the fact that the appellant are a software technology unit engaged in export of the services and that the rebate of duty paid inputs/input services used in development of software exported out of India would be available in terms of the Notification No. -S.T. only if no Cenvat credit in respect of those input/input services had been availed. Out of the two objections of the department in respect of the rebate, in question, the first objection is that the input services in respect of which the rebate has been claimed are not input/input services utilized for providing the services for export. The input services in respect of which rebate has been claimed are internet/telecommunication services, housekeeping services, professional services, outdoor catering services, renting of immovable property services, maintenance & repair services, security agencies services, rent -a -cab operator services, etc. In my view all these services would be necessary input for a software unit and hence, it would be totally incorrect to deny rebate on the ground that the same are not the services required for development of software more so, when during the period prior to the period of dispute and they paid after the period of dispute, the department has been granting rebate in respect of these very services. Besides this, I also find that the Commissioner (Appeals) while giving this finding has not given any reasons at all for the same. Therefore, the ground for denying rebate in para 4.4, of the impugned order is not a valid ground at all.