CENVAT credit refund in cash is admissible when unutilised credit cannot be used, rejecting denial of refund.

Unutilised CENVAT credit may be refunded in cash where the assessee is unable to utilise the credit. The Tribunal noted that the credit had been reversed and that the assessee was not in a position to use it, then applied binding precedent recognising cash refund in such circumstances. On that basis, it held that rejection of the refund was unsustainable and that the refund was admissible in cash.

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Issues: Whether refund of CENVAT credit was required to be sanctioned in cash when the assessee was unable to utilise the credit.

Analysis: The Tribunal noted that the appellant had reversed the credit, later sought refund, and was not in a position to use the credit. It relied on the binding precedent holding that where an assessee cannot utilise CENVAT credit, refund may be granted in cash. Applying that legal position, the Tribunal held that the rejection of refund was unsustainable.

Conclusion: The issue was decided in favour of the assessee and the refund was held admissible in cash.

Ratio Decidendi: Unutilised CENVAT credit may be refunded in cash when the assessee is unable to use it.

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