Genpact India Vs Commissioner of Central Goods & Service Tax (CESTAT Chandigarh)
The Chandigarh Bench of the CESTAT considered four appeals filed by Genpact India against orders of the Commissioner (Appeals) rejecting refund claims under Rule 5 of the CENVAT Credit Rules, 2004. The appeals involved refund amounts aggregating to Rs. 1,12,48,063/- for different periods between February 2008 and September 2010. The appellant was primarily engaged in providing BPO services, including call centre, back-office management and IT help-desk services.
It provided services to an overseas entity and exported the majority of its output services, while some services were provided to customers in India. The appellant classified its services as Business Auxiliary Services under the Finance Act, 1994, and there was no dispute regarding the classification or the export character of the services supplied to the overseas entity. Since substantial output services were exported, CENVAT credit on input services remained unutilized and refund was claimed under Rule 5.
The department had not disputed the eligibility of the CENVAT credit when it was originally availed, and no proceedings under Rule 14 of the CENVAT Credit Rules, 2004 were initiated to recover the credit. The refund claims were nevertheless partly rejected, principally on grounds concerning nexus between the input services and exported output services. The appellant contended that the disputed period was prior to April 2011, when restrictions were introduced in the definition of input service, and that the disputed services qualified as input services under the applicable provisions.
