2003 (12) TMI 469 - AT - Central Excise

Summary

Issues:
Refund claim for accumulated credit under Compounded Levy Scheme.

Analysis:
The case involved a dispute regarding a refund claim for accumulated credit by processors of man-made fabrics under the Compounded Levy Scheme. The Commissioner (Appeals) allowed the refund, citing Rule 57F(13) of the Central Excise Rules, 1944, which provides for the refund of specified duty in certain situations. The appellants were unable to utilize the accumulated credit due to the change in the method of central excise levy by the legislature. The Commissioner found that the refund claim fell within the ambit of Rule 57F(13) and the relevant notification, making the refund eligible based on the legislative intent.

The Revenue filed an appeal challenging the decision, arguing that the refund of accumulated credit was not covered under Rule 57F(13) as per Notification 85/87-C.E. The Revenue contended that there was no provision under the Compounded Levy Scheme for such refunds and no clarification from the legislature or government. The Revenue also disputed the interpretation of the term "for any reason" in Rule 57F(13) by the Commissioner (Appeals), stating that the refund claim was not sustainable in law.

Upon hearing both sides, the Tribunal found that the Commissioner (Appeals) correctly interpreted Rule 57F(13) and the relevant notification, allowing the refund claim. The Tribunal emphasized that the absence of government clarification should not frustrate the legislative intent behind the rule. Additionally, the Tribunal dismissed the Revenue's argument that more duty paid from PLA resulting in credit accumulation should deny the refund if the claim is otherwise eligible. Therefore, the Tribunal upheld the decision of the Commissioner (Appeals) and dismissed the Revenue's appeal, ordering the refund to be granted accordingly.