CENVAT refund and service tax rebate cannot be claimed together for the same export invoices under the refund rule.

Rule 5 of the CENVAT Credit Rules, 2004 does not permit simultaneous refund of CENVAT credit and rebate of service tax under the Export of Service Rules, 2005 for the same exported services. The two relief mechanisms operate in mutually exclusive fields, and claiming both against the same export invoices amounts to a prohibited double benefit. The expression "such tax" in the first proviso to Rule 5 was read in context and was not confined only to input duty so as to undermine the bar on concurrent claims. The refund claim was therefore correctly restricted and the challenge failed.

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Issues: (i) Whether rebate of service tax on exported services under the Export of Service Rules, 2005 and refund of CENVAT credit under Rule 5 of the Cenvat Credit Rules, 2004 could both be claimed in respect of the same exported services. (ii) Whether the expression "such tax" in the first proviso to Rule 5 was confined only to input duty.

Issue (i): Whether rebate of service tax on exported services under the Export of Service Rules, 2005 and refund of CENVAT credit under Rule 5 of the Cenvat Credit Rules, 2004 could both be claimed in respect of the same exported services.

Analysis: Rule 5 permits refund of CENVAT credit only subject to the prescribed safeguards, conditions and limitations, and its first proviso bars refund where the claimant also avails rebate of service tax under the Export of Service Rules, 2005. The two schemes operate in mutually exclusive fields. The inclusion of the same export invoices in the refund computation while also claiming rebate amounted to claiming a double benefit prohibited by the rule.

Conclusion: The appellant was not entitled to claim both rebate and refund on the same set of export invoices.

Issue (ii): Whether the expression "such tax" in the first proviso to Rule 5 was confined only to input duty.

Analysis: The language of Rule 5 uses "tax" in the context of service tax on output service, while input-side levy is referred to as CENVAT credit. Reading the proviso in the context of the whole rule, the expression could not be confined in the manner suggested by the appellant so as to defeat the bar against simultaneous rebate and refund.

Conclusion: The expression "such tax" was not limited in the manner urged by the appellant.

Final Conclusion: The refund claim was correctly restricted, the objection of double benefit was accepted, and the appeal failed.

Ratio Decidendi: Where Rule 5 of the Cenvat Credit Rules, 2004 bars refund if rebate of service tax under the Export of Service Rules, 2005 is also claimed, the two benefits cannot be availed simultaneously for the same export transactions.

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