2005 (1) TMI 500 - AT - Central Excise

Tribunal dismisses appeal on refund claim due to failure to comply with Cenvat Credit balance requirement

The Appellate Tribunal rejected the appeal concerning a refund claim under Exemption Notification No. 33/99-C.E. for duty paid in August 2003. The ... Refund - Benefit of Exemption Notification - Relevant time Issues:1. Refund claim under Exemption Notification No. 33/99-C.E.2. Utilization of Cenvat Credit balance for duty payment.3. Violation of natural justice.4. Interpretation of Notification No. 65/03-C.E. dated 6-8-2003.Refund Claim under Exemption Notification No. 33/99-C.E.:The case involved a manufacturer of non-Alcohol Beverage appealing for a refund claim of Rs. 9,57,152.00 on duty paid during August 2003 under Exemption Notification No. 33/99-C.E. The claim was rejected by the lower authority citing the requirement to utilize the entire Cenvat Credit available on the last day of the month under Notification No. 65/03-C.E. The Tribunal held that the notification's validity and applicability cannot be questioned based on the appellant's lack of awareness. The notification mandates utilizing the Cenvat Credit balance on the last day of the month, not on a day-to-day basis, thereby rejecting the appellant's claim for a refund for duty paid during 1-8-2003 to 5-8-2003.Utilization of Cenvat Credit Balance for Duty Payment:The amendment introduced by Notification No. 65/03-C.E. dated 6-8-2003 required manufacturers to utilize the entire Cenvat Credit available to them on the last day of the month for duty payment on goods cleared during that month. The appellant failed to consume the entire Cenvat credit during August 2003, as evidenced by the provided table. The Tribunal dismissed the appellant's argument that unutilized capital goods should not be considered for the refund claim. The notification's terms applied for the entire month of August 2003, and the appellant's failure to utilize the Cenvat Credit entirely disentitled them from claiming a refund.Violation of Natural Justice:The appellant contended that the order should be set aside due to a violation of natural justice. However, the Tribunal found that even if natural justice was granted, the appellant failed to substantiate their contentions during the appeal process or the personal hearing. Consequently, the appellant's claim lacked merit, and the argument of a violation of natural justice was dismissed.Interpretation of Notification No. 65/03-C.E. dated 6-8-2003:The Tribunal analyzed the amendment brought by Notification No. 65/03-C.E. dated 6-8-2003, emphasizing the requirement for manufacturers to utilize the entire Cenvat Credit available to them on the last day of the month for duty payment. The appellant's failure to comply with this condition led to the rejection of their refund claim. Various arguments presented by the appellant, including the timing of notification awareness and capital goods utilization, were considered and ultimately dismissed. The Tribunal upheld the denial of the refund claim based on the clear provisions of the amendment.In conclusion, the Appellate Tribunal rejected the appeal, emphasizing the strict requirements set forth by Notification No. 65/03-C.E. dated 6-8-2003 regarding the utilization of Cenvat Credit for duty payment. The judgment underscored the importance of compliance with statutory notifications and dismissed the appellant's arguments regarding refund eligibility, natural justice, and interpretation of the notification provisions.