CENVAT refund cannot be denied for mere ST-3 non-disclosure; unstated procedural conditions cannot defeat substantive entitlement.
Rule 5 of the CENVAT Credit Rules, 2004 permits refund of accumulated credit subject only to the conditions in the notification, and disclosure of the credit balance in ST-3 returns is not a condition precedent. Clause 2(g) of Notification No. 27/2012-CE(N.T.) limits refund to the lower of the quarter-end balance or the balance at the time of claim, but does not add an unstated reporting requirement. The text also states that a refund claim cannot be rejected merely because a corrigendum or revised return was filed later, or because credit was alleged not to have been taken within one year, where the underlying credit entries were accepted and the invoices were not shown to be time-barred. The appeal succeeded and refund was directed to be sanctioned according to law.
Issues: (i) Whether refund of accumulated CENVAT credit could be denied merely because the balance was not disclosed in the ST-3 return, and whether clause 2(g) of Notification No. 27/2012-CE(N.T.) dated 18.06.2012 permitted such a condition; (ii) Whether the refund could be rejected because the corrigendum and revised return were filed after the refund claim and on the ground that credit was allegedly not taken within one year.
Issue (i): Whether refund of accumulated CENVAT credit could be denied merely because the balance was not disclosed in the ST-3 return, and whether clause 2(g) of Notification No. 27/2012-CE(N.T.) dated 18.06.2012 permitted such a condition.
Analysis: Rule 5 of the CENVAT Credit Rules, 2004 allows refund of accumulated credit subject to the notified safeguards, conditions, limitations and procedure. Neither Rule 5 nor the notification makes disclosure of CENVAT credit balance in the ST-3 return a condition precedent for refund. Clause 2(g) only limits the refund to the balance lying at the end of the quarter or at the time of filing of the refund claim, whichever is less, and does not authorise the addition of a further requirement that the balance must be reflected in ST-3. A taxing notification must be read as written, without importing conditions not expressed in it.
Conclusion: The refund could not be denied on the ground of non-disclosure in the ST-3 return, and the contrary view was unsustainable.
Issue (ii): Whether the refund could be rejected because the corrigendum and revised return were filed after the refund claim and on the ground that credit was allegedly not taken within one year.
Analysis: The corrigendum and revised return were accepted by the Revenue, and no adverse finding was recorded against the underlying credit entries. The timing of the revised return did not defeat the claim because the notification contemplates verification of refund eligibility at the stage of sanction. The finding that credit was not taken within one year rested only on non-disclosure in ST-3, whereas credit is taken in the account records and not by the return alone. The record also did not show that the invoices were beyond the permissible period.
Conclusion: The refund could not be rejected on these grounds, and the assessee's claim remained legally maintainable.
Final Conclusion: The appeal succeeded, and the rejection of refund was set aside with a direction to sanction the refund in accordance with law.
Ratio Decidendi: A fiscal refund notification cannot be curtailed by importing an unstated procedural condition, and a substantive refund benefit cannot be denied on a mere technical non-disclosure where the underlying entitlement is otherwise established.