Limitation for CENVAT refund on service exports runs from quarter-end when foreign exchange is received, not invoice date.

For quarterly refund claims of unutilised CENVAT credit relating to export of services, the limitation under Rule 5 read with Section 11B is to be reckoned from the end of the quarter in which foreign exchange is received, because the statutory relevant-date framework does not fit service exports in the same way as goods exports. The Tribunal followed the Larger Bench view in Span Infotech and treated receipt of the Foreign Inward Remittance Certificate as the operative reference point. A later notification linking limitation to receipt of payment in convertible foreign exchange was applied prospectively and could not be used to defeat earlier claims.

---

---

Issues: Whether the one-year limitation for refund of unutilised CENVAT credit under Rule 5 of the Cenvat Credit Rules, 2004, read with Section 11B of the Central Excise Act, 1944, in the case of quarterly refund claims relating to export of services, is to be computed from the date of export invoice or from the end of the quarter in which foreign exchange is received.

Analysis: The refund scheme under Rule 5 operates subject to the conditions and time limit prescribed under Section 11B. For export of services, the statutory definition of relevant date does not directly fit the manner in which such services are completed, and the receipt of foreign exchange is therefore a material reference point. The Tribunal followed the Larger Bench view in Span Infotech, which held that for quarterly refund claims the limitation may be reckoned from the end of the quarter in which the Foreign Inward Remittance Certificate is received. The subsequent notification dated 01.03.2016, which linked limitation to receipt of payment in convertible foreign exchange, was treated as prospective and not as a basis to deny claims for earlier periods.

Conclusion: The refund claims could not be rejected by reckoning limitation from the date of export invoice alone, and the disallowance on limitation was unsustainable.

Final Conclusion: The impugned order was modified by removing the limitation-based rejection, while the undisputedly abandoned component was left undisturbed, and the appeals were disposed of with consequential relief.

Ratio Decidendi: For quarterly refund claims of unutilised CENVAT credit relating to export of services, the limitation under Section 11B is to be applied by taking the end of the quarter in which foreign exchange is received as the relevant reference point, and a later amendment cannot be used retrospectively to defeat earlier claims.

---