Cenvat credit refund under Rule 5 is unavailable for exports made on payment of duty under a rebate claim.

Refund of accumulated Cenvat credit under Rule 5 was unavailable where exported final products were cleared on payment of duty under a rebate claim, because the refund mechanism applies only to exports made without payment of duty under the prescribed bond procedure and excludes cases where rebate or drawback is claimed. As the goods were exported on payment of duty, the condition precedent for refund was not met. The rejection of the refund claim was therefore in accordance with law.

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Issues: Whether refund of accumulated Cenvat credit under Rule 5 of the Cenvat Credit Rules, 2004 was admissible when the exported final products were cleared on payment of duty under claim of rebate.

Analysis: Rule 5 permits refund of accumulated credit only where the final products are exported without payment of duty under the prescribed bond mechanism. The refund scheme and the notifications issued thereunder also exclude cases where rebate of duty or drawback is claimed. Since the goods in question were exported on payment of duty under a rebate claim, the condition precedent for refund was not satisfied.

Conclusion: The refund claim was not admissible and the rejection of the claim was in law. The issue is decided against the assessee and in favour of the Revenue.

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