CENVAT refund cannot be denied for a procedural debit-entry lapse when credit was substantively reversed and refund conditions were met.

Refund of unutilised CENVAT credit could not be denied merely because the debit was not reflected in the prescribed return, where the credit had in substance been voluntarily reversed and later debited in GSTR-3B. The procedural omission was treated as a technical defect, while the substantive refund conditions were otherwise satisfied. A Board circular supporting the view that such reversal amounts to non-availment of credit was relied on. The rejection of refund on this ground was therefore unsustainable, and the assessee was held entitled to the refund with consequential relief.

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Issues: Whether refund of unutilised CENVAT credit could be denied for want of debit entry in the prescribed return when the amount had been reversed in the credit account and later debited in GSTR-3B.

Analysis: The refund claim was rejected on the ground that the claimant had not shown the debit in the CENVAT account in the ST-3 return as required by the notification and the transitional provisions. The record showed, however, that the amount had been voluntarily reversed and later debited in GSTR-3B, and the Board's circular clarified that such reversal amounted to non-availment of credit. The defect was procedural, and the claimant had otherwise satisfied the substantive conditions for refund. Following the view taken in similar cases, the denial of refund on this technical ground was held unsustainable.

Conclusion: The refund could not be denied on the procedural lapse, and the assessee was entitled to the refund.

Final Conclusion: The impugned rejection of refund was set aside and the appeal was allowed with consequential relief.

Ratio Decidendi: A refund under the CENVAT scheme cannot be refused for a merely technical or procedural omission where the credit has in substance been reversed or debited and the statutory conditions for refund are otherwise fulfilled.

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