TaxTMI 
TaxTMI 
2024 (10) TMI 823
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.... into effect from 01.07.2017. As the CENVAT credit was denied, the Appellant, subsequently have filed a refund claim under Section 142(3) of CGST Act, 2017 read with Section 11B of the Central Excise Act, 1944 on 19.01.2018, claiming that the amount of service tax so paid after introduction of the GST laws was eligible as CENVAT credit under the Credit Rules. But the Department issued a Show Cause Notice dated 31.07.2018 seeking to reject the refund claim as there was no enabling provisions under CGST Act, 2017 to process the claims. The Appellant contended that they were eligible for refund in cash in terms of Section 142(3) of the CGST Act, 2017 which was rejected by the Department by Order-in-Original dated 24.04.2019 on the ground that the CENVAT rules ceased to be in force and their claim cannot be considered under CGST Act, 2017 in as much as the Service Tax was paid on 08.12.2017 after the CGST Act came into force. Further, it was held that any amount recoverable under the pre-existing law was liable to be recovered as an arrear of revenue and the amount so recovered was not eligible for any input tax credit in terms of Section 142(7)(a) of the CGST Act,2017. Aggrieved, the ....
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....ioner (Appeals) was also rejected by the order dated 21.09.2019. ... ... ... 49. In the present case, the service tax was paid under the provisions of Chapter V of the Finance Act and refund was claimed under sub-section (3) of section 142 of the CGST Act, under which the claim was required to be disposed of in accordance with the provisions of the existing law. Therefore, even if the service tax had been deposited by the appellant after 01.01.2017, nonetheless the refund of any amount of the CENVAT credit could be claimed only under sub-section (3) of section 142 of the CGST Act and against this order an appeal will lie to the Tribunal." 3. The Ld. Counsel Shri Raghavan Ramabadran have reiterated the grounds of appeal and then advanced the following submissions which have been summarised as given below: - i. It was averred that the impugned order was clearly beyond the scope of the SCN as the SCN sought to reject the refund claim in terms of Section 142(3) of the CGST Act, 2017 while the impugned order dated 21.09.2019 relied on Section 142(8). ii. It was submitted that Section 142(8) of the CGST Act, 2017 was not applicable since the denial under Second proviso on cl....
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.... Excise, Ujjain Vs. M/s Shakti Pumps (i) Ltd. - Final Order No. 56004/2024 dated 08.07.24 in Excise Appeal No. 51131/2020 -CESTAT, New Delhi. 4. The Ld. Authorised Representative for the Department, Smt. O.M. Reena, supported the findings in the impugned order and reiterated that the Appellant is not eligible for any CENVAT credit in terms of Section 142(7)(a) / 142(8) of CGST Act, 2017 as the tax was paid only as an arrear of revenue and therefore was not entitled to refund in cash. The Ld. AR has argued that the appeal was devoid of merits and prayed for dismissal of the appeal filed by the appellant. 5. Heard both sides and carefully considered all the submissions made and as evident from the records in this appeal. 6. The main issue that is required to be determined is whether the Appellant is eligible for refund of CENVAT credit in terms of Sec. 142(3) of CGST Act, 2017 which could not be claimed under the erstwhile laws due to implementation of GST laws with effect from 01.07.2017? 7. It is important to refer to the following provisions of CGST Act, 2017: - i. Section 142(3) "Every claim for refund filed by any person before, on or after the appointed day, for refund ....
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....sment or adjudication proceedings instituted, whether before, on or after the appointed day, under the existing law, any amount of tax, interest, fine or penalty becomes refundable to the taxable person, the same shall be refunded to him in cash under the said law, notwithstanding anything to the contrary contained in the said law other than the provisions of sub-section (2) of section 11B of the Central Excise Act, 1944 and the amount rejected, if any, shall not be admissible as input tax credit under this Act." 8. It is not in dispute that an audit was conducted of the accounts of the Appellant during November 2017 for the period from April 2015 to June 2017 and the appellants have been called upon to pay short paid Service Tax and applicable interest which was duly paid by the Appellant on 08.12.2017. The Appellant has claimed eligibility to avail CENVAT Credit of this service tax paid in terms of the provisions of CCR, 2004. However, the Appellant was dis-allowed from taking CENVAT credit of the service tax so paid, since the Central Goods and Service Tax Act, 2017 ('CGST Act') had come into effect from 01.07.2017, in place of the erstwhile regime. The Appellant was also disab....
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....VAT Credit pertaining to the services had not been reflected as balance transitional credit in their statutory returns, they were not able to transfer the credit amount in their TRAN-1 into G.S.T. regime. Ld. Commissioner (Appeals) also observes that sample copies of the invoices furnished before him were dated either 30.06.2017 or prior to that date, by which the Ld. Commissioner (Appeals) assumes that those invoices had already been issued by the service providers to the appellant. This conclusion appears to be jumping the gun with no documentary evidence on record and nothing on this being alleged to this effect in the Show Cause Notice. This reason, therefore, cannot be sustained. 6. There is also no dispute that the appellant is not found to be ineligible for its refund otherwise; nor are its refund claims found to be wrong. The Revenue has also not suspected the bona fides of the appellant as regards the receipt of service or remitting of Service Tax under reverse charge mechanism. It is the introduction of the C.G.S.T. Act that prompted the appellant to claim the refund because they were unable to carry it forward, which fact also satisfies the requirements of the second p....
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.... a person after the appointed day for refund of tax paid under the existing law in respect of services not provided shall be disposed of in accordance with the provisions of existing law and any amount eventually accruing to him shall be paid in cash, notwithstanding anything to the contrary under the provisions of existing law other than the provisions of sub-section (2) of Section 11B of the Central Excise Act, 1944 (unjust enrichment). 9. Thus, from a conjoint reading of sub-sections (3), (5) and (8)(a) of the CGST Act, it is evident that an assessee is entitled to claim refund of service tax under RCM paid after the appointed day under the existing law and such claim has to be disposed of according to the provisions of the existing law. As the appellant was entitled to Cenvat credit of the said amount of Rs. 9,85,827/-, which is now no longer available due to GST regime, they are entitled to refund of the said amount." 10.4 In Appeal No. ST/40095/2021-SM pertaining to Terex India Pvt. Ltd. Vs. Commissioner of GST & C.E., SALEM in [2022 (63) GSTL 238(Tri.-Chennai)], this Tribunal on a similar issue has held that: - "6.2 The refund claim has been rejected resorting to Sectio....