Refund of unutilized compensation cess credit in zero-rated supply cases remanded for fresh consideration.

Refund claims for unutilized compensation cess credit relating to zero-rated supplies were not finally decided on merits. The High Court noted the competing positions on the GST and cess provisions, along with reliance on the relevant circular and later decisions on refund of compensation cess credit in export and SEZ supply cases. It held that the departmental rejection required reconsideration in light of those authorities. The rejection and appellate orders were set aside, and the matter was remanded to the original authority for a fresh decision after hearing the petitioner and in accordance with law.

---

---

Issues: Whether the petitioner was entitled to refund of unutilized compensation cess credit relating to zero-rated supplies, and whether the rejection orders required interference and fresh consideration.

Analysis: The dispute concerned refund claims arising from compensation cess paid on inputs used for manufacture of exported goods and supplies to SEZ units. The Court noted the rival stand on the applicability of the GST and cess provisions, and the parties' reliance on the circular and later High Court decisions addressing refund of unutilized compensation cess credit in zero-rated supply cases. Without independently dilating on the larger legal controversy, the Court proceeded on the basis that the departmental position needed reconsideration in the light of the cited decisions.

Conclusion: The rejection and appellate orders were set aside and the matter was remanded to the original authority for a fresh decision in accordance with law after hearing the petitioner.

Final Conclusion: The refund dispute was not finally decided on merits in these writ petitions, and the claims were directed to be reconsidered afresh by the original authority.

---