Page 116 - GSTL_2nd July 2020 _Vol 38_Part 1

34 GST LAW TIMES [ Vol. 38
company against valid consideration and imported into India on payment of ap-
propriate customs duty. Appellant undertook research activity on the said goods
and exported the services viz. “Technical Testing and Analysis Service/Scientific
and Technical Consultancy Service”, against convertible foreign exchange. They
had availed Cenvat credit on various input services used in providing the output
taxable services. Since the output services were exported, the appellant claimed
cash refund of accumulated Cenvat credit under Rule 5 of the Cenvat Credit
Rules, 2004 for the period from January, 2014 to December, 2015 by filing quar-
terly refund claims from time to time. The adjudicating authority rejected their
refund claims on the ground that the services provided by the appellant to their
overseas customer cannot be considered as an ‘export service’ and secondly the
input services on which credit was availed do not fall within the scope of ‘input
service’ as prescribed under Rule 2(l) of the Cenvat Credit Rules, 2004. Ag-
grieved by the said order, they filed appeal before the Learned Commissioner
(Appeals), who on the first count held that the research and development ser-
vices provided by the appellant cannot be treated as an ‘export service’; and on
the issue of applicability of the definition of ‘input service’, he has observed that
except in relation to two services, there has been nexus between the other input
services and output services and accordingly the said services satisfied the defi-
nition as prescribed under Rule 2(l) of the Cenvat Credit Rules, 2004. Hence, the
present appeals.
3. The Learned Advocate Shri D.H. Nadkarni for the appellant submits
that they had provided services outside India in relation to technical testing and
analysis service. It is his contention that as per clause (d) of Rule 6A of Service
Tax Rules, 1994, the place of the provision of service is “outside India”. It is his
contention that under the Place of Provision of Services Rules, 2012, from Rule 4
onwards the respective rules are divided subject-wise i.e. performance based
service, immovable property, events etc., and as such the service provided by the
appellant would not fall in any of these categories. It is his contention that the
services rendered by the appellant squarely covered under the scope of Rule 3 of
the Place of Provision of Services Rules, 2012 and as the recipient of service is
located in Denmark, the said service is an export service since it satisfies the con-
dition (d) of Rule 6A of the Service Tax Rules, 1994.
4. He has further submitted that the goods on which research was con-
ducted by the appellants were imported from Denmark on payment of appropri-
ate customs duty on the transaction price of the said goods paid to the supplier
and there is no temporary transfer of the said goods, but it is a transaction of sale
and purchase of the goods. As per C.B.E. & C. Guidance on service tax vide TRU
Circular dated 20-6-2012, Note 5 clarifies that it is essential that to cover under
Rule 4, the goods should temporarily come under the physical possession or con-
trol of the service provider and without such effect, the service cannot be termed
as rendered in India. In the present case, since the goods have been purchased
from their Denmark company, hence provision of Rule 4(a) of the Place of Provi-
sion of Services Rules, 2012 will not be applicable. Further, he has submitted that
period from April, 2013 to June, 2013, in similar facts in their own case, this Tri-
bunal decided the issue in their favour reported as Fertin Pharma Research & De-
velopment Pvt. Ltd. - 2017 (6) G.S.T.L. 475 (T). Also, this Tribunal in the case of
Commissioner of Central Excise, Pune-I v. Sai Life Sciences Ltd. - 2016 (42) S.T.R. 882
(Tri. - Mum.) and Principal Commissioner of Central Excise, Pune-I v. Advinus Thera-
peutics Ltd. - 2017 (51) S.T.R. 298 (Tri. - Mum.) held that undertaking test in India

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