Quarter-wise export turnover must be verified before rejecting Cenvat refund claims based on invoice attribution.

Refund under Rule 5 of the Cenvat Credit Rules, 2004 could not be rejected merely because no bill was raised in the third quarter, where the dispute concerned whether a single invoice covered export services spread over the second and third quarters of FY 2016-17. The Tribunal noted that the appellant had asserted quarter-wise attribution of the invoice value and that this factual claim required verification from the record. The rejection was therefore set aside and the matter remanded to the Adjudicating Authority for limited examination of the invoice and export turnover. If the bill is found to relate to both quarters, the refund is to be allowed with interest as per rules.

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Issues: Whether the refund claim under Rule 5 of the Cenvat Credit Rules, 2004 was liable to be rejected on the footing that no export services were rendered in the relevant quarter and whether the invoice amount could be apportioned between the second and third quarters of financial year 2016-2017.

Analysis: The relevant refund claim was based on export of services and the dispute turned on the correct identification of export turnover for the third quarter. The appellant's case was that the invoice for USD 50,000 covered services spread over two quarters, with USD 30,000 attributable to the third quarter. The record before the Tribunal showed that this factual assertion had been raised earlier and that the invoice needed verification to determine the true quarter-wise attribution of the export services. In these circumstances, the denial of refund solely on the basis that no bill had been raised in the third quarter was not sustainable without examining whether the invoice in fact related to both quarters.

Conclusion: The rejection of the refund claim was set aside and the matter was remanded to the Adjudicating Authority for limited verification of the invoice and quarter-wise export turnover. If the bill is found to relate to the second and third quarters, the refund is to be allowed with interest as per rules.

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