TaxTMI 
TaxTMI 
TaxTMI 
2018 (1) TMI 40
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....ification No.56/2002-CE dated 14.11.2002. The said notification provides a mechanism for exemption by laying down a specific procedure, which requires an assessee to first avail the benefit of Cenvat credit of duty paid on various inputs and to utilise such credit for payment of duty on their final product. In case the duty required to be paid on the final product is more than the Cenvat credit available to the assessee, such duty is required to be paid through PLA and the assessee is entitled to the refund of such duty paid through their account current. 2. In the present case, during the period may, July, September, November 2006 and January 2007 the appellant imported raw materials and paid additional duty of customs on the same to the ....
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..... 4. The original adjudicating authority did not find favour with the appellant's contention and observed that inasmuch as the appellant is working under the notification which requires taking of credit and utilising the same for payment of duty on the final product, the appellant's action of payment of duty by cash and subsequently claiming the refund has resulted in erroneous excess refund to the assessee which was not admissible to them. As such he observed that the appellant has engaged themselves in suppression and mis-statement leading to availment of excessive erroneous refunds of a considerable amount, thus calling for imposition of penalties. He accordingly ordered recovery of wrongly availed refund of self credit of Rs. 1....
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....id that the appellant has claimed excess refund, thus leading to the recovery of the same. 7. It is also in record that the inadvertent mistake committed by the assessee was subsequently rectified as they took the credit of the additional duty. Such credit can be utilised by them for future payments, thus leading to less payments in cash and consequent less refunds. The entire situation is Revenue neutral and it cannot be said that the appellant benefited by not availing the credit and paying the higher amount of duty in cash. In fact it can be specifically observed that by non-availment of credit was disadvantageous to the appellant as they had to shelve out excess cash from their pockets for payment of the differential duty. 8. In such ....
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....r to first utilise the whole of the cenvat credit available to them on the last day of month. The mechanism of implementation of exemption given by the Notification has an intrinsic monthly orientation. Hence, the extent of exemption given for the particular month is decided by the cenvat credit available at the end of the month, which has to be exhausted before paying the remaining duty through the PLA. Reading of opening lines of Para 1 (A) of the aforesaid notification shows that the very eligibility of exemption is subject to the availment of cenvat credit on the last day of the month. Similarly, the reading of para 2(A) shows the quantum of self credit of duty as ascertained and taken by the manufacturer during the month under consider....
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....d to the goods. This is clearly a faulty approach on the part of the Tribunal. It is stated at the cost of repetition that the assessee was required to fulfil the condition in strict senso viz to pay the duty either in cash or through account current if it wanted to avail the benefit of exemption notification and not through adjustment of Cenvat credit which is not the mode prescribed in the aforesaid conditions. Once we find that the conditions have not been fulfilled the obvious consequence would be that the assessee was not entitled to the benefit of this notification." "5. However, in a case like this, the mistake, if any, was bona-fide which would no doubt deprive the assessee of the benefit of the exemption notification but it is not....