2004 (4) TMI 136

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....ve heard the DR. 2. The appellants are manufacturers of cotton and man-made fabrics. They were working under the compounded levy scheme since 16-12-1998 and were accordingly discharging duty liability in terms of Rule 96ZQ of Central Excise Rules, 1944. Prior to 16-12-1998, they had outstanding unutilised credit on inputs in their RG 23A Part II. They were unable to utilise such credit for paym....

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....s Industries Ltd. v. CCE, Bombay-II reported in 1994 (70) E.L.T. 722 (T). Ld. DR however, submits that the fundamental requirement for allowing a refund claim is that the duty should have been paid by the claimant, His submission is to the effect that as the duty on the inputs was not paid by the appellants, refund thereof is not admissible to them. I am unable to accept this argument. Had the law....

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....cinded and consequently it was not possible for the assessee to avail the set-off. The Tribunal held that, in such a factual situation, the assessee was entitled to claim cash refund of the duty paid on the inputs. I think it is this principle which has been embodied in the proviso to Section 11B(2) of the Act. The ground raised in the appeal is forceful. Both the authorities have apparently overl....