Accumulated Cenvat credit refund cannot be denied for a nil return entry when contemporaneous records prove entitlement.

Refund of accumulated Cenvat credit cannot be denied merely because the ST-3 return showed a nil balance, where contemporaneous records otherwise established the available credit. The relevant refund condition required the claim not to exceed the credit balance available at the end of the quarter or at the time of filing, but the return was not treated as the sole reliable record for that purpose. Accounts, invoices and a chartered accountant certificate were accepted as supporting evidence. Delay in filing a revised return was treated as procedural, and a return error was regarded as rectifiable. A procedural lapse could not defeat a substantive refund entitlement backed by documentary proof.

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Issues: Whether refund of accumulated Cenvat credit could be denied merely because the ST-3 return showed nil balance and the revised return was sought beyond the prescribed period, when the assessee produced other contemporaneous documents showing available credit.

Analysis: The refund condition under the relevant notification required the refund amount not to exceed the credit balance available at the end of the quarter or at the time of filing the claim. The ST-3 return was held not to be the only reliable record for determining the availability of credit, since the assessee's accounts, invoices and chartered accountant certificate showed the accumulated credit. The delay in filing a revised ST-3 return was treated as procedural, and the mistake in the return was regarded as rectifiable. A procedural restriction could not defeat a substantive refund claim when the entitlement was otherwise supported by documentary evidence.

Conclusion: The refund could not be rejected solely on the basis of the nil balance shown in the ST-3 return, and the denial of permission to revise the return was unsustainable. The order rejecting the refund was set aside and the assessee succeeded.

Ratio Decidendi: A refund of accumulated credit cannot be denied for a procedural error in the return where the assessee otherwise establishes entitlement through reliable contemporaneous records.

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