RG 23 credit under excise rules could not be converted into cash refund despite excess duty payment.

Rule 56A barred cash or cheque refund of credit lying in RG 23 account, even where excess duty had been paid on the finished product. The special provision for utilising unutilised credit in specified situations did not override the express prohibition on converting statutory credit into cash. Where credit was available for adjustment, the proper course was crediting the RG 23 account rather than payment in cash. Accordingly, a claim for cash refund of the excess amount was not maintainable.

---

---

Issues: Whether excess duty paid on the finished product could be refunded in cash when part of the payment was adjusted through RG 23 credit under Rule 56A of the Central Excise Rules, 1944.

Analysis: The relevant rule expressly provided that no part of the credit in RG 23 account could be refunded in cash or by cheque. The special provision allowing utilisation of unutilised credit in specified circumstances did not dilute the general prohibition against cash refund of such credit. The refund provision for excess duty did not authorise conversion of a statutory credit into a cash refund merely because excess duty had been collected on the finished product. The proper course, if any credit was available for adjustment, was credit to the RG 23 account, not cash payment.

Conclusion: The claim for cash refund of the excess amount was not maintainable and was rejected.

---