TaxTMI 
TaxTMI 
TaxTMI 
2026 (2) TMI 1332
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....n on 30.07.2013. On 12.06.2014, the Appellant had filed a refund claim under Rule 5 of CENVAT Credit Rules, 2004 for refund of the unutilized CENVAT credit lying in their books of account for the period from April 2006 to March 2010, since they are unable to utilize the CENVAT credit even after exports. The Adjudication authority as per order dated 29.05.2015 rejected the refund claim on the ground that it is hit by time limitation under Section 11B of Central Excise Act, 1944 and refund claim is not eligible under Rule 5 of CENVAT Credit Rules, 2004. Aggrieved by the said order, an appeal was filed before the Commissioner (Appeals) and Commissioner (Appeals) as per order dated 08.09.2017, remanded the matter to original Adjudication authority for fresh adjudication. In denovo adjudication, Adjudicating authority held that there is no specific discussion in the order dated 08.09.2017 issued by Commissioner (Appeals) regarding the eligibility for refund. Accordingly the refund claim was rejected. Aggrieved by said order, an appeal was filed before the Commissioner (Appeals) and Commissioner (Appeals) as per the impugned order dated 25.07.2022 again remanded the matter. Aggrieved by ....
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....08 Mar 2008 & April 2008 8,158 2 Belated payment of Service Tax upon internal auditor's observation in 2011 Management consultant service April 2008, May 2008, June 2008 & January 2010 Sept 2008 & Jul 2012 2,41,019 3 Belated payment of Service Tax under RCM voluntarily 3.1 Manpower Recruitment & Supply Agency Services vide Challan no. 565105 Jul 2006 to Jun 2009 14-Jul-10 24,69,134 3.2 Management consultant service vide Challan no.565106 Mar 2006 to Mar 2008 14-Jul-10 16,89,095 Total 53,71,486 5. Learned CA also draws our attention to the CENVAT credit register produced as part of the Memorandum of Appeal and also the ER-1 returns and submits that the time limit specified under section 11B of the Central Excise Act, 1944 is not applicable to refund claims filed under Rule 5 of Cenvat Credit Rules, 2004 since the refund claim is filed in terms of Rule 5 of Cenvat Credit Rules, 2004. Rule 5 of Cenvat Credit Rules, 2004 provides as follows: "Rule 5 Refund of CENVAT credit.-Where any input or input service is used in the manufacture of final product....
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....isions of Rule 5 relates to refund of Modvat credit accumulated in the records on account of non-utilization for the exported goods is a beneficiary piece of legislation, the refund arising on account of the same cannot be denied being a substantive right of the citizen. The wording of Rule 5 read with Rule 3 are very clear providing for refund of accumulated Modvat credit if the same cannot be adjusted for any reason. As such the only condition in the said Rule is non-utilization of the credit and no jurisdiction vests in the Central Excise officer to find out the reason for such non-adjustment. The use of the expression that "where for any reason" such adjustment is not possible, the manufacturer shall be allowed refund of such amount is an unlimited expression and cannot be narrowed down or curtailed by the departmental authorities." 7. Learned CA for the Appellant further submits that Notification 5/2006-CE dated 14.03.2006 specifies the conditions, limitation and safeguards for claiming refund under Rule 5 of Cenvat Credit Rules, 2004. Paragraph 6 of this notification specifies that the refund claim needs be filed within the time specified in section 11B of the Central Exci....
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...., the same was considered in the case of Sanghi Textiles and it was held that limitation under Section 11B would not be applicable in the case of refund claim for accumulated credit under Rule 5 of Cenvat Credit Rules, 2004. Further, the learned Chartered Accountant also cited decision of the Tribunal in the case of Anjani Synthetics Limited - 2001 (132) E.L.T. 688 (Tri.), in support of his contention. In the absence of specific provisions related to refund of accumulated credit in Section 11B of Central Excise Act, 1944, the claim of the appellant that time limit is not applicable has to be upheld as similar view was taken in the decision cited above. Accordingly, the impugned order is set aside as regards rejection of refund claim. In the result, appeal filed by the Revenue is rejected and appeal filed by the appellant is allowed. Applications for stay as well as for early hearing also get disposed of." 9. Similar view was adopted by this Tribunal in the case of Commissioner of Central Excise-Hyderabad Vs. Hyundai Motors India Engineering-[2011 (21) STR 667] wherein the Hon'ble CESTAT rejected the appeal filed by the Revenue authorities on the following grounds: 3....
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....ring & Foundary Works Pvt., Ltd. Vs. CCE, Raipur-[2014 (8) TMI 433 CESTAT NEW DELHI] wherein the Appellate Tribunal held that the Revenue should have been conscious to enquire about genuineness of transactions at the first de-novo adjudication stage itself and even after having ample opportunities to do so, if it does not, then the same cannot be questioned in a second round of litigation. Further, it was held that such lapse by the Revenue would amount to dereliction of duty by the Revenue under law and the appellant should not suffer due to this. 13. As regards the reliance of the Adjudication authority on the judgment of Hon'ble High Court of Mumbai in the matter of M/s. Gauri Plasticulture Pvt ltd & Manufacturing Co. Ltd., M/s. Simplex Milss Co. Ltd., Vs. The Commissioner of C.Ex. Indore, - 2019 (6) TMI 820 Bombay High Court, Learned Counsel draws our attention to the Paras 29 and 30 of the judgment and submits that said refund pertain to inputs lying in stock without being used in the manufacture of products. In the present case, the refund pertains to input services which were used in the manufacture of products and exported. It is only availment of CENVAT credit which hap....
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....wherein it is held that; "2. Respondent-company is engaged in manufacture of shoes for M/s. Bata India Ltd. They are registered under the Central Excise Registration. The respondent surrendered their registration. A refund application was made on 14-5-2003 claiming a refund of Rs. 4,15,057/-. During the Internal Audit, it was noticed that the assessee has availed Cenvat Credit of the materials received by them during the past on the strength of the photocopies of the duplicate copy of invoices and the original copies of the invoices were never produced. The assessee had availed the credit to the tune of Rs. 3,09,390/-. On scrutiny, it was noticed that there was neither production nor clearance of finished goods. Cenvat Credit availed by the respondent is irregular. A show cause notice was issued in the matter with regard to irregular availment and also with regard to rejection of refund claim. Reply was submitted. Thereafter, an order was passed ordering allowance of Cenvat Credit of Rs. 3,72,405/- availed on the invoices mentioned in the show cause notice except invoice No. 62 dated 19-2-2002. Refund claim was also rejected in terms of Sec. 11B of the Act. It was stated t....
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....the light of the closure of the factory and in the light of the assessee coming out of the Modvat Scheme. In these circumstances, we answer all the three questions as framed in para 17 against the Revenue and in favour of the assessee. 6. Ordered accordingly. No costs." 17. Further, we find that the issue was also considered by the Tribunal in the matter of M/s. ATV Projects India Pvt., Ltd., Vs. CC, Raigad (supra) majority it is held that:- "29.2 As a manufacturer of excisable goods, the appellant herein got itself registered with the jurisdictional Central Excise authorities. It has also availed cenvat credit of central excise duty paid on the inputs and capital goods as well as service tax on the input services. Availment of cenvat credit by the appellant as per the statutory provisions has never been objected to by the department. Further, it is not the case of Revenue that the cenvat credit availed inputs or capital goods were removed by the appellant, without putting the same for intended purpose i.e., manufacture of final products. This is evident from the fact that the appellant had continued to maintain the credit balance in the cenvat account till clo....
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.... application within a reasonable time frame, from the date of closure of the factory, in my opinion, the same should not be denied on the ground of limitation, inasmuch as the purpose of the cenvat scheme would be defeated, if the benefits accrued in lawful manner is denied." 18. Further in Appellant's own case, issue was considered by the Tribunal in the matter of CC. Vs. M/s. Molex India Pvt., Ltd., (supra) and as per the Final Order No. 70142/2017 dated 20.01.2017 it is held that:- "5. Heard the Ld. Counsel for the respondent who has contended that it is an admitted fact in the Show Cause Notice that respondent factory is closed. He has further submitted that ruling of Hon'ble High Court of Karnataka in the case of Slovak India Trading Co. Pvt. Ltd. (Supra) was challenged by Union of India before Hon'ble Supreme Court of India and Hon'ble Supreme Court has dismissed the petition." 6. Having considered the rival contentions and on perusal of record, I find that in para 5 of the ruling of Hon'ble High Court of Karnataka in the case of Slovak India Trading Co. Pvt. Ltd. Versus Commissioner of Central Excise, Bangalore reported at 2006 (205) E.L.....