TaxTMI 
TaxTMI 
2012 (4) TMI 385
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....not in position to utilize the credit of duty paid on inputs allowed under erstwhile Rule 57 AU of Central Excise Rules,1944 (Rule 3 of the Cenvat Credit Rules, 2002) as they had exported the finished goods under LUT, during the mentioned period. Therefore, they had filed the above refund claims in view of the provisions laid down under Rule 5 of the Cenvat Credit Rules, 2002. 2.3 While deciding the matter at the level of jurisdictional Assistant Commissioner/Deputy Commissioner, appellant were issued two Show Cause Notices form file F.No.V/18-01/Ref./02-03 dated 18.02.2008 and V/18-21/Ref./01-02 dated 11.02.2002 calling upon them, why their claim of refund should not be rejected on the grounds explained therein. The Deputy Commissioners, Central Excise, Division Vapi-II of erstwhile Central Excise Commissionerate, Surat-II, vide his Order in Original No.282/DC/REF/2002-03/Vapi-II dated 07.06.2002 and the Assistant Commissioner, Central Excise, Division-III Silvassa vide his Order in Original No.01/AC/REF/2002-03/SILVASSA-III dated 07.03.2003 rejected the refund claims for Rs.52,54,06,51/- dated 31.01.2003 and Rs.18,17,67,645/- dated 26.09.2001 on the grounds cited therein.....
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.... Rule 57 AC(7) of Central Excise Act, 1944. On verification and as per the report of jurisdictional Assistant Commissioner, the amount of refund claim was after ascertaining the amount attributable to inputs used in manufacture of finished goods exported under Bond/LUT was held to be Rs.65,79,35,635/-, while amount lying in balance in CENVAT Credit register after utilisation of credit, post filing of refund claim was Rs.44,20,58,831/-. 2.7 Therefore, M/s Sterlite Industries (I) Ltd., Chinchpada, Silvassa submitted an application to the Assistant Commissioner, Division-III, Silvassa on 08.11.2004 for seeking the refund of Cenvat credit amounting to Rs.44,20,58,831 /- involved on goods exported in terms of Rule 57 AC(7) of Central Excise Rules 1944 now Rule 5 of Cenvat credit Rules 2002. 2.8 Being aggrieved with the OIA No. RKS/240-241/VAPI/2004 dated 05.11.2004 passed by the Commissioner (Appeals), Department filed an appeal with CESTAT but the same was rejected by CESTAT vide its final order No.1382 1385/WZB/2008-C-II dated 09.08.2005. 2.9 In between the assessee filed a petition (SCA No. 12251/2005) on 16.06.2005 with the High Court of Gujarat under Article....
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....is erroneous, inasmuch as the letter dt.8.11.04 was only seeking the amount back from the authorities, after the appeal has been allowed by first appellate authority and attained finality at the level of the Tribunal on 15.09.04. He would rely upon the decision of Hon'ble High Court of Gujarat in the case of Reliance Industries Limited 2010 (259) ELT 356 (Guj), for the proposition that the amount of refund claim under Rule 5 of CENVAT Credit Rules, 2004 would be a refund governed under the provisions of Section 11B of Central Excise Act, 1944 and the provisions of Section 11BB of Central Excise Act, 1944, for providing interest will be applicable, when there is a delay in refunding the amount. He would also submit that the said judgment of Hon'ble High Court of Gujarat was taken in appeal by the Revenue by filing a SLP to the Apex Court, which was dismissed after condonation of delay. He would submit that the judgment of constitution bench of India in the case of Central Bank of India Vs. Ravindra & Ors (2002) 1 Supreme Court Cases 367, has held that the interest, inter-alia, is a compensation fixed by agreement or allowed by law, for use or retention of the money. He would read Pa....
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....ability on the final product cleared for home consumption. It is also seen that the appellant had exported the goods under LUT/bond during the relevant period. We find that the constitution bench of the Apex Court in the case of Central Bank of India (supra), has clearly enunciated what would be the interest and its classes which with respect, we reproduce. 37. Black s Law Dictionbary (7th Edn.) defines interest inter alia as the compensation fixed by agreement or allowed by law for the use or detention of money, or for the loss of money by one who is entitled to its use; especially, the amount owed to a lender in return for the use of the borrowed money. According to Stroud's Judicial Dictionary of Words And Phrases (5th, Edn.) interest means, inter alia, compensation paid by the borrower to the lender for deprivation of the use of his money. In Secy., Irrigation Deptt., Govt. of Orissa v. G.c. Roy [(1992)1 SCC 508] the Constitution Bench opined that a person deprived of the use of money to which he is legitimately entitled has a right to be compensated for the deprivation, call it by any name. It may be called interest, compensation or damages ... this is the principle of Sectio....
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....ensation allowed by law or fixed by the party or permitted by custom or usage, for use of money, belonging to another, or for the delay in paying money after it has become payable. In this case, it is undisputed that the amount which has been claimed by the appellant was refundable to the appellant as per law. 11. As regards the contentions raised by the ld.SDR that the refund of CENVAT Credit will not fall under the category of refund under the provisions of Section 11B of Central Excise Act, 1944, we find that the said proposition has already been negated by Hon'ble High Court of Gujarat in the case of Reliance Industries Ltd (supra). We reproduce the ratio. 11.?There is a basic fallacy in the premise on which the contention of Revenue is based. Cenvat credit is nothing else but credit for duty paid by the supplier of inputs, which are dutiable goods manufactured by the supplier or dutiable services rendered by the service provider. In principle such goods/services when utilised for further manufacture or providing service which are dutiable already carry the duty paid component as a part of its price/value, and hence the duty payable on the ultimately manufactured goods/servic....
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....ssal order dt.27.7.2011. 12. In view of this, it is settled legal position that the appellant is eligible for claiming interest from the Revenue authorities for delayed sanction of refund claim. 13. This leads us to another question as to what amount should be considered by authorities for calculation of interest to be paid to the assessee. We find in the appeal memorandum that the appellant is claiming interest on the entire amount of Rs.70,71,74,155 for which the refund has been claimed by them. In our view, this seems to be little erroneous inasmuch as two refund claims were filed one on 17.09.2001 for an amount of Rs.18,17,67,645/- and another refund claim was filed on 31.03.2003 for an amount of Rs.52,54,06,510/- and the refund entitlement after verification was arrived at Rs.65,79,35,635/- by lower authorities. It is also undisputed that till the sanctioning the refund claim of Rs.44,20,58,831/-, the appellant has been utilizing credit from the amount of Rs.65,79,35,635/- as indicated hereinabove. That is to say that after filing refund claim of the amounts as indicated hereinabove, the appellant has been utilizing the same for discharge of duty till the refund claim....