P.G. Chacko
These applications filed by the department (appellant) seeks stay of operation of the impugned orders. After hearing both sides, we are of the view that the appeals itself require to be finally disposed of at this stage. Accordingly, after rejecting the stay applications, we proceed to deal with the appeals.
2. The respondent (assessee) had filed refund claims under Rule 5 of the CENVAT Credit Rules 2004 read with Notification No. 5/06 CE (NT) dated 14.03.2006, claimed refund of unutilized CENVAT credit on certain services (claimed to be input services) for the period from October 2007 to June 2008. The claim was on the ground that the said services had been used in relation to output services exported. The original authority granted partial relief to the assessee after holding that some of the services which were claimed to be input services did not have any nexus with the output services. Against the adverse part of the decision of the original authority, the assessee preferred appeals to the Commissioner (Appeals) while the department reviewed the rest of the decision of the original authority and accordingly preferred appeals to the Commissioner (Appeals). Learned Commissioner (Appeals) considered the Boards Circular No. 120/01/2010 dated 19.01.2010 which had clarified that the amount to be refunded under Rule 5 ibid required to be quantified on the basis of chartered accountant’s certificate. The appellate authority accordingly set aside the relevant orders-in-original and required the Assistant Commissioner to grant relief to the assessee upon satisfaction of the conditions laid down in the above circular. Further, it rejected the department’s appeal. The operative part of the orders-in-appeal which is presently under challenge reads as follows:
ORDER
“I set aside the Orders-in-Original No. 89/2008 dated 04.03.09, 197/09 dated 29.04.2009, 239/09 dated 12.06.2009 and 157/10 dated 29.03.10 all passed by Assistant Commissioner of Service Tax, I Division, Service Tax Commissionerate, Bangalore as discussed above with the consequential relief on satisfaction of the conditions laid down in the Board’s Circular 120/01/2010 dated 19.01.2010 and reject the appeal filed by the department.”
The present appeal of the department is mainly on the ground that the impugned orders were passed without jurisdiction inasmuch as the Commissioner (Appeals) did not have the power of remand. In this connection, the appellant has relied on the Hon’ble Supreme Court’s judgment in the case of MIL India Ltd. Vs. CCE, Noida 2007 (210) E.L.T. 188 (S.C). Learned SDR has also cited the Tribunal’s decision in the case of CCE, Noida Vs. Orient Crafts Ltd. 2011 (21) S.T.R. 302 (Tri.-Del.). It is submitted that in the case of MIL India Ltd. (supra), the apex court held that the Commissioner (Appeals) did not have the power of remand from 11.05.2011 by virtue of amendment to Section 35A of the Central Excise Act under the Finance Act, 2001. In the case of CCE, Noida Vs. Orient Crafts Ltd. (supra), it was held that the Commissioner of Service Tax (Appeals) also did not have the power of remand under Section 85 (5) of the Finance Act, 1994. In view of these decisions, according to learned SDR, the present appeals of the department are liable to be allowed.
3. The learned consultant for the respondent submits that the impugned orders are indeed not a remand orders inasmuch as a clear view was taken by the appellate authority on the specific issue relating to nexus between input services and output services and only the re-quantification of refunds in terms of the Board’s circular was left to be done by the lower authority. It is further submitted that the respondent has since obtained the refunds on the basis of orders passed by the original authority pursuant to the order of the Commissioner (Appeals).
4. After considering the submissions, we find that these appeals are only liable to be dismissed. As rightly submitted by the learned consultant for the respondent, the impugned orders cannot be considered as a remand orders. Learned Commissioner (Appeals) found nexus between the input services and the output services and only require the lower authority to re-quantify the amount for refund on the basis of the Boards circular dated 19.01.2010 ibid. The appellate authority rightly noted that, when the original orders were passed by the adjudicating authority, the Boards circular was not in force. It also noted that the procedure prescribed by the Board required to be followed in the matter of examining refund claims of the above kind. Obviously, in such circumstances, the appellate authority rightly required the original authority to re-quantify the amounts for refund on the basis of chartered accountant’s certificate to be produced by the party in terms of the Board’s circular. Such orders cannot be held to be a remand orders attracting the case law cited by the learned SDR. No other ground is permitted in this situation. The appeals are rejected.
5. We have also found on record the written submission filed by the respondent, styled as cross objections and was registered by the registry. For the record, these cross objections also will stand disposed of.
6. Stay applications also stand disposed of.