Central Excise assessee wins refund appeal as Tribunal rules limitation period doesn't apply under GST.

The Tribunal allowed the appeal of a Central Excise assessee seeking a refund of Rs. 2 lakhs deposited in their PLA under the Central Excise regime, which became non-usable after the introduction of GST. The Tribunal held that the limitation period for filing the refund application did not apply in this case, as the cause of action arose only when the refund became admissible under GST provisions on 1 July 2017. Consequently, the Tribunal set aside the lower authorities' decision, granting the refund and providing consequential relief to the appellant.

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Issues:
Refund of amount deposited in PLA under Central Excise regime after introduction of GST - Applicability of limitation period for refund application.

Analysis:
The appellant, a Central Excise assessee, deposited an amount in their PLA which became non-usable with the introduction of GST provisions from 1 July, 2017. The issue revolved around the refund of the balance in the PLA, amounting to Rs. 2 lakhs, as the appellant filed a refund application beyond the one-year limitation period from the date of deposit. The original adjudicating authority rejected the refund application on grounds of limitation, a decision upheld by the Commissioner (Appeals) leading to the present appeal.

During the hearing, the Counsel for the appellant argued that the PLA deposit is akin to "duty waiting to be debited" and not a duty under the Act, citing a Tribunal decision. The Counsel contended that if the appellant couldn't utilize the PLA deposit due to GST introduction without any transitional provision for transfer, they were entitled to a refund. The Tribunal noted that the lower authorities considered the date of deposit as relevant for the limitation period, leading to the rejection of the refund application. However, the Tribunal opined that limitation provisions did not apply to such refunds, and the application, filed on 26 June, 2018, should be deemed within the one-year period as the cause of action arose only on 1 July, 2017, when the refund became admissible.

Consequently, the Tribunal found no justification for denying the refund and set aside the impugned order, allowing the appeal with consequential relief to the appellant. The decision was pronounced in open court on 4 March 2020.

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