Tribunal affirms remand for refund claim verification; Revenue's challenge rejected. Small Scale Industry exempt from cash refund.

The Tribunal upheld the Commissioner (Appeals) decision to remand the matter for verification of refund claim contention by the Appellants, M/s. Babu Textile Industries. The Tribunal rejected the Revenue's challenge to the remand order and affirmed that as the Respondents were exempt from paying duty as a Small Scale Industry (S.S.I.) unit, there was no provision for cash refund, and credit entry into the RG23A Part-II Account sufficed. Consequently, the appeal was dismissed, and the impugned order was upheld.

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Issues involved: Challenge to Order-in-Appeal remanding matter for verification of refund claim; Payment of duty from Modvat Credit Account; Provision for refund in cash.

Summary:

Issue 1: Challenge to Order-in-Appeal remanding matter for verification of refund claim
The Revenue challenged Order-in-Appeal No. 474/2002, dated 13-6-2002, which remanded the matter to the Adjudicating Authority for verifying the contention of the Appellant, M/s. Babu Textile Industries. The Commissioner (Appeals) had allowed the appeal filed by the Respondents, who claimed refund of Central Excise duty pursuant to Order-in-Appeal No. 1063/99. The Assistant Commissioner sanctioned the refund but directed the Respondents to take credit in their RG 23 A - Part-II. The Commissioner (Appeals) remanded the matter to verify the contention of the Appellants, stating that if found correct, the refund may be allowed in cash.

Issue 2: Payment of duty from Modvat Credit Account
The learned S.D.R. argued that since the duty was initially paid out of the Modvat Credit Account, any refund should be given by allowing credit entry into RG23A Part-II Account only, as there is no provision for cash refund in such cases. The Respondents, being a Small Scale Industry (S.S.I.) unit, are now exempt from paying duty and may not be maintaining an RG 23A - Part-II Register for credit entries.

Issue 3: Provision for refund in cash
The Tribunal found that the Respondents, as an S.S.I. unit, are not currently paying duty due to exemption. Therefore, they may not have an RG 23A - Part-II Register for credit entries. The Commissioner (Appeals) remanded the matter to verify the factual position, and the Tribunal upheld this decision, rejecting the appeal. The Tribunal concluded that there was no infirmity in the impugned order, and thus, the appeal was dismissed.

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