2008 (3) TMI 577 - AT - Central Excise

Refund of accumulated credit for exports upheld, despite revenue's export clearance argument.

The Tribunal upheld the Commissioner (Appeals) order allowing the refund of accumulated credit for goods exported under bond. The revenue's argument that ... Refund of accumulated Cenvat/Modvat credit Revenue appealed denial of challenge to refund of 'accumulated credit' earned on goods exported under bond, arguing cash refund on a 'monthly basis' is permissible only when 'average export clearance of dutiable goods in value terms is 70% or more than the goods manufactured in the preceding three months,' and here export clearance was ~50%. Tribunal found neither lower authority stated refunds were claimed on a monthly basis; the dispute concerned a 'quarterly refund application,' so the revenue's ground fails. Revenue also did not demonstrate that the accumulated credit could have been utilized because duty on home clearances was paid out of PLA instead of Cenvat credit. Crucially, since it was not the revenue's case that the credit refunded 'does not relate to the inputs which was used in the manufacture of export products,' the refund claim could not be denied. Appeal by revenue was rejected for lack of merit.