2019 (12) TMI 333 - AT - Central Excise

Tribunal allows refund claim, deems demand unsustainable, overturns Commissioner ruling

The Tribunal upheld the appellant's contention regarding the rejection of the refund order, setting aside the initial rejection and allowing the refund ... Recovery of Refund of terminal excise duty - Period of limitation - benefit of N/N. 108/95-CE dated 28.8.1995 - case of appellant is that due to delay in receiving World Bank loan, the appellant had deposited the entire amount of terminal excise duty benefit with the Department, which otherwise admissible - HELD THAT:- Tribunal in the case of POWER GRID CORPORATION OF INDIA LTD. VERSUS C.C.E., & CUSTOMS, JAIPUR II [2015 (6) TMI 742 - CESTAT NEW DELHI], this Tribunal allowed their appeals. In the present case, after receiving the World Bank loan, they filed the refund claim but could not be pursued, due to pending demand notice issued to M/s EMI Transmission Ltd. After the order of the learned Commissioner dropping the demand, the appellant pursued the refund, which was sanctioned to them. Therefore, the demand is unsustainable. Refund allowed - appeal allowed - decided in favor of appellant. Issues:1. Rejection of the refund order2. Confirmation of demand of the refund sanctionedAnalysis:Issue 1: Rejection of the refund orderThe appellant, engaged in construction and commissioning of transmission lines, executed a project known as the 'Talcher Project' approved by the Government of India. Due to a delay in receiving a loan from the World Bank, the appellant deposited the entire amount of terminal excise duty benefit. Subsequently, upon receiving the loan, the appellant filed a refund claim, which was initially sanctioned but later challenged by the Revenue. The appellant contended that the delay in receiving the loan necessitated the deposit and subsequent refund claim, which was supported by previous Tribunal judgments in similar cases. The Tribunal, considering these precedents, observed that the payment made by the appellant was rightly treated as a deposit and the claim for refund was rightly entertained without reference to time-bar provisions. The Tribunal upheld the appellant's contention and set aside the rejection of the refund order.Issue 2: Confirmation of demand of the refund sanctionedFollowing the rejection of the refund order, a demand notice was issued to the appellant for the refund amount sanctioned and paid to them. The Revenue challenged the refund sanction, leading to an appeal before the Commissioner (Appeals) who ruled in favor of the Revenue, confirming the demand. However, the Tribunal, after considering the previous Tribunal decisions and the circumstances of the case, found no infirmity in the appellant's claim for refund. The Tribunal allowed the appeals, setting aside the impugned orders and providing consequential relief as per law. Consequently, the demand for the refund amount was deemed unsustainable, and the appeals were allowed in favor of the appellant.This detailed analysis of the judgment highlights the issues of rejection of the refund order and confirmation of the demand of the refund sanctioned, providing a comprehensive overview of the legal proceedings and the Tribunal's decision in each aspect of the case.