Rule 5 Cenvat credit refund limited to inputs used in exported goods; unutilized balance for stock or work-in-process is not refundable.

Refund of unutilized Cenvat credit under Rule 5 was confined to credit relatable to inputs actually used in the manufacture of exported goods during the relevant period. Credit remaining in the balance, including amounts attributable to stock inputs, work-in-process, finished goods, or bought-out items, could not be treated as refundable merely because it was unutilized. As the original authority had already segregated and sanctioned only the credit linked to exported goods, the lower appellate view was sustained and the refund claim beyond that extent was held inadmissible.

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Issues: Whether refund of unutilized Cenvat credit was admissible under Rule 5 in respect of credit attributable only to inputs actually used in the manufacture of exported goods.

Analysis: The refund under Rule 5 is confined to credit relatable to inputs used in the production of goods exported during the relevant period. Credit lying in the balance may also include amounts attributable to stock inputs, work-in-process, finished goods, or bought-out items, and such amounts cannot be treated as refundable merely because they remain unutilized. Since the original authority had already segregated and sanctioned only the credit attributable to exported goods, the lower appellate view was found to be correct.

Conclusion: The refund claim beyond the credit attributable to exported goods was not admissible and the Revenue's view was upheld.

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