TaxTMI 
TaxTMI 
2026 (6) TMI 395
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....er manufactured and used by them captively. Factual matrix of both the cases being identical and being dealt a common impugned order, both appeals were heard together and are being taken up together. 2. Both the Appellants' factories are located in Himachal Pradesh and were engaged in the manufacture of Cement; the appellants availed exemption from Central Excise duty under Notification no.50/2003-CE dated 20th June 2003; the Appellants also manufactured Clinker, part of which was cleared outside the factory on payment of duty and balance was used captively in the factory for manufacture of the Cement on which the said duty exemption under Notification No.50/2003-CE was availed; the Appellants were denied the benefit of exemption from Central Excise duty under Notification No.67/95CE dated 16-3-1995 on the portion of the Clinker which was captively consumed in the manufacture of exempted Cement on the grounds that final product was exempted; the Appellant had litigated the issue up to the Hon'ble Supreme Court. Hon'ble Supreme Court, by their Order dated 21-8-2015, held that the Appellants were entitled to the exemption under Notification no.67/95-CE on the Clinker captively con....
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...., the Appellant by their e-mail dated 10-12-2024, submitted that the quantification the refund amount of Rs.652,41,66,464/- by Order-in-Original dated 169-2016 had attained finality since no appeal against the same had been preferred by the department; However, Assistant Commissioner, vide the impugned Order-in-Original dated 26-122024, increased the deduction on account of the said Cenvat Credit amount of Rs. 39,44,73,881, already deducted vide order dated 169-2016, to Rs. 55,00,39,624/- and thereby reduced the refund amount from Rs.652,41,66,464/- to Rs.636,86,00,721/-. 4. Learned Counsel submits in respect of appeal filed by M/s Ambuja Cements Ltd (Appeal No. E/60906/2025) that consequent to the Hon'ble Supreme Court's decision, by Order-in-Original dated 7/15-92016, the Deputy Commissioner of Central Excise sanctioned Refund of Rs.191,09,14,680/-, as against refund claimed of Rs. 209,42,47,320; Deputy Commissioner arrived at the refund amount by deducting the Cenvat Credit, of 11,23,89,005/- plus interest of Rs.7,09,43,635, which was already deducted while arriving at the refund amount vide order dated 7/15-9-2016; the said Order also recorded the Appellant's acceptance ....
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.... authority will not be liable to be refunded to the Appellant; in view of the said Order dated 1-7-2024 of the Tribunal, the said refund amount of Rs.652,41,66,464 sanctioned to ACC Ltd and Rs 191,09,14,680 sanctioned to M/s Ambuja Cements Ltd, after deducting the said Cenvat Credit, by the respective Orders-inOriginal, but which had been credited to the Consumer welfare fund, became liable to be paid and refunded to the Appellant. 8. Learned Counsel submits, without prejudice to the aforesaid submissions, that the re-quantification is not only legally permissible as above, but also not acceptable on facts as the original deduction arrived at by orders issued in 2016, was on the basis of the verification Report of the Range officer; the same was mentioned in the Orders-in-Original passed in 2016. Learned Counsel submits that the lower authorities have failed to appreciate that Tribunal has in its Order dated 1-7-2024 noted in that the adjudicating authority had recorded a finding that the Appellant had agreed to the deduction of the Cenvat Credit availed on the inputs used in the manufacture of clinker captively consumed from the amount deposited in respect of such clinker.; tri....
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....ducting the Cenvat credit availed; the Cenvat credit availed on the inputs used in the manufacture of captively consumed clinker was computed on the basis of the ER-1 returns filed by the appellants; the appellant has not challenged the correctness of the calculation of Cenvat Credit. She submits that the direction given by the Tribunal to reduce the refund to the extent of Cenvat Credit has not been challenged by the appellants. 11. Heard both sides and perused the records of the case. Brief issue that requires our consideration in the instant appeals is as to whether the Revenue was correct in deducting the Cenvat Credit amount from the refund that was required to be granted to the appellants in terms of the Final Order dated 01.07.2024 of this bench. The appellants contended that the lower authorities misread and misinterpreted the above order; the Bench vide Final Order cited above, held very clearly that if there was any dispute about the Cenvat Credit department ought to have taken necessary steps to recover the same along with interest as per law; as the original authority has already deducted the Cenvat Credit of Rs. 39,50,09,497 in respect of M/s ACC Ltd and Rs 11,23,89....
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....d in these cases. We find that neither the original authority nor the first appellate authority have denied Cenvat Credit. The adjudicating authority records a finding that the appellants have submitted that the refund claimed by them may be reduced to the extent of the Cenvat credit the appellants have availed on the inputs used in the manufacture of clinker. We also find that the original authority records that the appellants did not agree to the deduction of interest on the Cenvat credit availed by them. We are of the considered opinion that, in case the appellants have Cenvat Credit in a wrongful manner, revenue could have taken necessary steps to recover, the same along with the interest, as per law. We find that the appellants have fairly conceded that the Cenvat credit, availed by them, on the inputs used in the manufacture of clinker, during the entire period in dispute. We find that the availment of Credit cannot be a bar for claiming refund of duty paid on intermediate or final products. Moreover, special counsel submits that the appellant had produced CA certificate on 12.05.2017, whereas the Order in Original rejecting the claim for refund was passed on 16.09.2016 where....
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....ly consumed in the manufacture of cement. (iv). If the department has any issues with the admissibility of the credit availed, they were free to take action as per law. 14. It is nowhere specified in the order that Cenvat credit should be deducted again even if it has been deducted while arriving at the refundable amount in the orders passed in 2016. Such an interpretation is bereft of any legal backing and in addition would be defeating the spirit of the justice. It was mentioned in the operative portion of the order that However, refund as at (i) above, be granted after deducting the Cenvat Credit availed by them on the inputs used in the manufacture of Clinker, during the period in dispute, is in order to restrict the claim of the appellants as their appeals are allowed and to make it clear that they shall not claim refund of the same as per their applications before the jurisdictional authorities, consequent to the decision of Hon'ble Supreme Court, by their Order dated 21-82015. We are of the considered opinion that it can in no way be construed as a right conferred to the department to deduct the amount on account of Cenvat availed a second time there ....
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....e Supreme Court that an order which has attained finality between the parties can only be assailed in a manner known to law and mere over-ruling of the principles followed in the said order by a subsequent judgment cannot dilute the binding effect of the decision. In Global Constructions, the Tribunal examined almost a similar issue. The adjudicating authority sanctioned the refund amount but credited it to the Consumer Welfare Fund. The Tribunal held that though the Supreme Court had subsequently held in ITC that a refund can be claimed only if the assessment order is modified but since the finding of the adjudicating authority sanctioning refund was not assailed by the department before the Commissioner (Appeals), it would not be permissible for the department to raise this issue before the Tribunal. 45. Learned authorized representative appearing for the department has relied upon the decision of the Tribunal in Shiv Naresh Sports to contend that even a respondent can raise a legal issue. It needs to be noted that the legal issue that is now sought to be raised by the department is that the refund applications are not maintainable for the reason that assessment proceedi....
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....84,476/-. Further the claimant had also intimated that they had availed Cenvat credit to the tune of Rs 39,44,73,881/- on the inputs and Input Services used in the manufacture of Clinker during the period from May 2005 to February 2013. They also submitted the ratio of clearance of Clinker (year wise break-up) after payment of duty vis-a-vis the total clearance of clinker for the period from May 2005 to Feb. 2013. From the above, the total clearance of Clinker that is being captively consumed for manufacture of Cement can be derived. Accordingly, the Cenvat credit availed on inputs and Input services used in the manufacture of Clinker which was captively consumed for manufacture of Cement during the period from May 2005 to Feb. 2013 is arrived at Rs 39,44,73,861/-. in their refund claim, the assessee had mentioned that the refund claimed amount of Rs 652,41,66,464/- is net of the Cenvat credit availed of the inputs and the Input services used in the manufacture of clinker which were later captively consumed in the manufacture of duty exempted cement during the period May 2005 to Feb. 2013. i.e. Rs. 6,919,784,476/- (gross refund amount) minus Rs. 39,44,73,981/- (Cenvat credit on Inp....
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....lso needs to be calculated on the same from the date of availment of such Cenvat credit i.e. 28.02.2013. Further I see that the assessee had availed the Cenvat credit on the input and input services to the tune of Rs 11,23,89,005/- in the month of February 2013(on 28.02.2013), in respect of Clinker used for captive consumption and the interest on such Cenvat credit availed has to be taken in to account for the period since February 2013 and to be set off while arriving at their present refund claimed amount. The total interest on the said Cenvat credit, availed by them on 28.02.2013, up to 31.08.2016 comes to Rs 7,09,43,635/- which is also required to be deducted from the amount claimed as refund by the assessee as agreed by them during the personal hearing. Hence in view of the above and as agreed by the assessee/claimant, I find that the actual refund claimed amount as consented by the assessee/claimant in this case comes out to be Rs 191,09,14,680/- (209,42,47,320/- (-) 11,23,89,005/- (-) 7,09,43,635/-) and the interest thereon in terms of section 35FF of the Central Excise Act, 1944, which needs to be decided in this case. I, therefore, restricts myself to decide their refund c....