2019 (5) TMI 42 - AT - Central Excise

Appellant's refund claim deemed time-barred due to erroneous CENVAT credit use, court upholds lower authorities' decision.

The court upheld the decision of the lower authorities, ruling that the appellant's refund claim was time-barred. The appellant's use of CENVAT credit for ... Refund claim of amount of interest debited by them in PLA during 2003 - default in payment of duty - Time limitation - HELD THAT:- The debit of interest in RG 23A in march, 2003 was not in accordance with the law as in terms of Rule 3 of the Cenvat Credit Rules 2004, specifically mandates that the Cenvat Credit availed can be utilised for making payment of duty only. The absence in specific provision to debit the amount of interest in CENVAT account, It was found that it was erroneous on the part of the appellant to use CENVAT credit for paying interest. The payment of interest in cash in 2014, and claiming refund of amount debited in March 2003 is definitely time barred, when it is not disputed that they have to pay interest. Appeal dismissed - decided against appellant. Issues involved:1. Refund claim filed by the appellant and its limitation period.Analysis:The appeal was directed against an Order-in-Appeal from 2018 regarding a duty payment default during 2002-05. The appellant had deposited the duty amount through CENVAT Credit and cash, including interest. However, the Revenue did not accept the interest debit, leading to a demand confirmed on appeal. The appellant later deposited the interest amount in cash in 2014 and applied for a refund in 2014. Both lower authorities found the refund application time-barred. The appellant argued that the refund claim was within time as the payment was made in 2014. The judge noted that the debit of interest in 2003 was not in accordance with the law, as CENVAT Credit should only be used for duty payment. The judge found it erroneous for the appellant to use CENVAT credit for interest payment and deemed the refund claim time-barred, considering the acknowledged interest payment in 2014.The judge also discussed the judgments cited by the appellant, emphasizing that they were in different contexts. The Motorola India Pvt Ltd. case involved an excess payment not due to the government, while the Wires & Fabriks case dealt with debiting CENVAT account and PLA with the same amount on the same date. The judge concluded that the refund claim was not hit by limitation in the latter case. Ultimately, the judge upheld the lower authorities' decision, stating that the appeal did not merit acceptance due to the time-barred refund claim. The judge found the impugned order correct and legal, requiring no interference, and thus rejected the appeal.