Commissioner allows rebate claims in cash, not cenvat account, citing Rule 18.

The Commissioner (A) set aside the rejection of rebate claims by the Deputy Commissioner of Central Excise and allowed the rebate claims. The Lower Adjudicating Authority sanctioned a rebate under Rule 18 of CER 2002, which the appellant argued should be issued in cash instead of being credited to their cenvat account. The Commissioner held that the rebate should be paid in cash to encourage exports, not credited to the cenvat account. Additionally, the Commissioner ruled in favor of the appellant's entitlement to interest under Section 11BB for delayed payment of the rebate.

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Issues:
- Whether the rebate sanctioned should be credited to the cenvat account or issued in cash.
- Whether the appellant is entitled to interest on delayed payment of rebate.

Analysis:
- The appellant, a manufacturer of printed cartons, filed an appeal against the rejection of rebate claims by the Deputy Commissioner of Central Excise. The Commissioner (A) set aside the rejection and allowed the rebate claims. The Lower Adjudicating Authority then sanctioned a rebate of Rs. 1,67,70,094 under Rule 18 of CER 2002. The appellant contended that the rebate amount should have been issued in cash and not credited to their cenvat account. They argued that interest should be paid under Section 11BB for the delayed sanction of rebate.
- The Commissioner found that there was no provision empowering the adjudicating authority to credit the rebate in the cenvat account. Referring to a circular by C.B.E. & C., it was clarified that duty paid on exported goods through a credit account must be refunded in cash. The Commissioner held that crediting the rebate amount in the cenvat account did not constitute payment of rebate as intended by the government to encourage exports. Therefore, the order crediting the rebate in the cenvat account was set aside, and the lower authority was directed to issue a cheque/cash to the appellant for the sanctioned rebate amount.
- Regarding the claim for interest on delayed payment of rebate, the Commissioner noted that the impugned order did not discuss this aspect. Citing a judgment from the Hon'ble High Court of Gujarat, it was held that the appellants were entitled to interest under Section 11BB of the Central Excise Act, 1944, for the period from three months after the rebate application until the issuance of the cheque for the amount. The appeal was allowed, affirming the appellant's right to interest on delayed payments of rebate.

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