TaxTMI 
TaxTMI 
2025 (11) TMI 676
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....ereon under Section 11 B(b) of the Central Excise Act, 1944 ("said Act") and seeks a writ of mandamus to direct the 2nd Respondent to forthwith grant and pay the same. The challenge arises in the facts and circumstances set out hereafter. RELEVANT FACTS AND CIRCUMSTANCES. 4. The Petitioner manufactures motorcycles and scooters falling under Chapter 87 ("final products"). These attract a levy of Basic Excise Duty ("BED") under Section 3 of the said Act and the National Calamity Contingent Duty ("NCCD") under Section 136 of the Finance Act, 2001. The inputs used in the manufacture of the final products attracted only BED and not NCCD. 5. The Petitioner's case is that, in terms of Rule 1 of the Cenvat Credit Rules, 2004 ("CCR, 2004"), BED and NCCD paid on the inputs are admissible as CENVAT credit. Accordingly, the Petitioner availed such CENVAT credit paid on such inputs. Further, up to 29 February 2016, in terms of Rule 3(4)(a) of CCR, 2004, CENVAT credit was allowed to be utilised for payment of any duty of excise, including NCCD, on any final product. 6. However, by Notification No.13/2016- CE(NT) dated 01 March 2016, a fifth proviso was introduced in Rule 3(4) of CCR,....
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.... percentage of the outstanding tax dues. Upon such payment, the taxpayer was to be immune from the recovery of the balance tax, full interest, and full penalty. 13. By application/declaration in Form SVLDRS-1 made in the prescribed form on 28 December 2019, the Petitioner applied for the benefits under the SVLDRS in respect of the demands in the order dated 05 December 2019. In the Application, the Petitioner pointed out that the amount demanded by the order in original dated 05 December 2019 was already paid in cash by the Petitioner and that the same be adjusted against the dues payable under SVLDRS. 14. The Petitioner's Application under SVLDRS and the proposal contained therein were accepted, and a discharge certificate in Form SVLDRS-4 was issued to the Petitioner. The legal effect of this Form was that the Petitioner was discharged from payment of any further duty, interest or penalty in respect of the final products cleared domestically and for exports during the relevant period of March 2016 to June 2017. Further, no NCCD, interest or penalty was liable to be paid by the Petitioner for the said period. 15. The Petitioner's case is that, once the Petitioner made the....
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....ner, clarified that under no circumstances was the Petitioner seeking any duplicate payments, and that if the Petitioner were to receive rebate to the extent of Rs. 3,26,17,188/-, then the Petitioner would make necessary deductions from the Petitioner's claim of refund, which the CESTAT has now rejected in the proceedings challenging the CESTAT's order dated 23 April 2025. 21. By separate 63 orders-in-original issued between 31 July 2018 and 16 October 2018, the Respondents adjudicated the show cause notices issued, and the Petitioner's rebate claim in respect of NCCD paid on the final products exported was rejected. However, neither the show cause notices nor, consequently, these orders-in-original disputed the rebate of BED on goods exported by the Petitioner by utilizing the CENVAT credit of BED. 22. The Petitioner appealed the above orders-in-original. However, the Commissioner (Appeals), vide orders-in-appeal dated 30 October 2018 and 31 December 2018, upheld the rejection of the rebate claim in respect of the NCCD amounts paid by the Petitioner by utilizing the CENVAT credit of BED. 23. The Petitioner filed a revision application against the orders-in-appeal before t....
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....271) ELT 32 (Guj.). to support this contention. 27. Mr. Sridharan also relied upon Section 136 of the Finance Act, 2001, and the 2001 amendment to this Section and pointed out that the provision of levy of interest on delayed payment of NCCD was introduced only in 2021, and that such a substantive amendment has not been given any retrospective effect to cover the period between March 2016 and June 2017. He submitted that this was an additional reason why no interest way payable on allegedly delayed NCCD. 28. Mr. Sridharan submitted that the proviso to Section 142(4) of the CGST Act was not applicable in the instant case. He submitted that claim for refund was never rejected on the ground that the Petitioner had not exported a portion of the final products. Accordingly, Mr. Sridharan submitted that the Petitioner's rebate claim could not have been rejected by invoking the proviso to Section 142(4) of the CGST Act. 29. Mr. Sridharan submitted that even the provisions of Section 130(1) of Finance (No. 2) Act, 2019, were not attracted in the facts of the present case. He submits that this Section only bars a taxpayer from reopening a settled dispute by requesting a refund. He ....
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....espect of a final product exported outside India. He reiterated that this is the only subject matter of this Petition, and that the Petitioner was not seeking any refund of the balance, approximately Rs 18/19 Crores, in this Petition, but would pursue that matter in separate proceedings. 34. Based on the above contentions, Mr. Sridharan contended that the impugned common order dated 17 January 2022 made by the 2nd Respondent be set aside and the relief of rebate in an amount of Rs. 3,26,17,188/- be granted to the Petitioner. RESPONDENT'S CONTENTIONS. 35. Mr Karan Adik, the learned counsel for the Respondents, submitted that there was no error, much less any jurisdictional error, in the impugned common order dated 17 January 2022. He submitted that all the reasons set out therein, including the reason that NCDD payments made by the Petitioner in cash were under protest, were valid reasons for rejecting the Petitioner's rebate claim. 36. Mr Adik submitted that if the Petitioner had not made payments "Under Protest" or "Disputed", then "the picture may have been different at the time of granting rebate" ( this is quoted from paragraph 1 (v) of the brief written submissions....
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....before the CESTAT was nowhere in the original Writ Petition but was disclosed only in the additional affidavit filed after the institution of the Petition. Similarly, the order dated 23 April 2025 dismissing the Petitioner's Excise Appeal No. 41585 of 2019 was also not disclosed at the final stage of the hearing of this Petition. He submitted that this amounts to a clear suppression dis-entitling the Petitioner to any equitable relief under Article 226 of the Constitution. 42. Mr. Adik submitted that Excise Appeal No. 41585 of 2019 pertains to the refund of the entire amount of Rs. 22,31,16,229/- for the period from March 2016 to June 2017. This is the same amount and period that form the subject matter of this Petition. In any case, he argued that this amount includes the rebate claim of Rs. 3,26,17,188/- sought in this Petition. Mr. Adik contended that this is merely a case of the Petitioner attempting to receive double benefits, which is unlawful. 43. Mr. Adik submitted that the CESTAT, in its order of 23 April 2025, rejecting the Petitioner's Excise No. 41585 of 2019, had recorded a categorical finding of fact that the Petitioner had already passed on the burden of the du....
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....he second Respondent, had to address themselves to the provisions of Rule 18 of the CER 2002 and Notification dated 6 September 2004. Unfortunately, from a perusal of the impugned common order dated 17 January 2022, we find that these precise issues have not been considered in light of Rule 18 and the Notification dated 6 September 2024. 50. The liability in law, to pay such tax on the final products exported in the given factual complexion, coupled with the above provisions, is required to be addressed, which is amiss in the impugned common order. This becomes crucial because the liability to pay the underlying tax/duty in the given factual compass and the payment of interest thereon, if at all, as mandated by law, warrants application of mind followed by findings by the 2nd Respondent, in the first instance. 51. The Petitioner first contended that no duty, i.e., BED and/or NCCD, was payable on the final products exported outside India. The Petitioner, however, had the option to pay such duty before exporting and afterwards claim a rebate, or to export by submitting a bond without paying any duty. The Petitioner contended that, since both modes were allowed, a parity of cons....
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....claims filed by the Petitioner, the rebate of BED on the goods exported by utilising the BED credit was not even disputed by the Respondents in their show cause notices issued between 20 March 2018 and 24 August 2018. The dispute was only with respect to the rebate claim for NCCD, totalling Rs. 3,26,17,188/-. 57. Therefore, the issue of nexus between non-payment of interest on the alleged delayed payment of NCCD and rebate under Rule 18 of CER, 2002, read with Notification dated 06 September 2022, was the crucial issue before the 2nd Respondent, and this issue has not been addressed or decided by the 2nd Respondent in the impugned common order dated 17 January 2022. 58. The third issue concerns the payment of the demanded amount of Rs. 22,31,16,229/- in cash, "under protest" or by signing the same as "disputed" as being one of the reasons for rejection of rebate claim does not appeal to us is nowhere reflected in the impugned common order dated 17 January 2022. On this issue, we note that the impugned common order states, as a matter of fact, that the amount was paid in cash "under protest". However, there is nothing in the impugned common order which suggests the payment of ....
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....outside India. All these aspects have not been considered in the impugned common order dated 17 January 2022. 63. The arguments or reasons concerning overlap and unjust enrichment cannot, at least prima facie, be accepted in these proceedings, mainly because they are not reflected in the impugned common order dated 17 January 2022. No opportunity was also provided to the Petitioner to address these aspects, if they were intended to form the basis for denying the rebate claim. Of course, Mr. Adik, with some justification, argued that such material in the form of CESTAT's order dated 23 April 2025 was not available to the respondents when the impugned common order was issued. But it is equally possible to argue that such a plea was not raised because it does not relate to refunds or rebates for exports out of India, or that the petitioner's rebate claim was limited solely to the amount of Rs. 3,26,17,188/- in respect of payment of NCCD on finished products exported outside India. 64. However, the fact remains that none of these aspects was considered when making the impugned common order dated 17 January 2022. These aspects cannot be considered for the first time in the present....