2005 (1) TMI 538 - AT - Central Excise

Summary

Issues:
Refund of duty paid under Notification No. 33/99-C.E., retrospective application of Notification No. 61/2002-C.E., entitlement to refund considering Cenvat credit availed.

Analysis:
The case involved the submission of three refund claims by the respondents for duty paid between December 2002 to February 2003 under Notification No. 33/99-C.E., dated 8-7-1999. The Deputy Commissioner allowed the refund as the duty was paid by the assessees post 24-12-1997, and they were entitled to it. However, the Cenvat credit availed by the assessees was also considered, as per the proviso added by Notification No. 61/2002-C.E., dated 23-12-2002. The assessees had utilized Rs. 27,049.13 of Cenvat credit by the end of each corresponding month, leading to the sanctioning of refunds after adjusting for the Cenvat credit availed during the disputed period.

The Commissioner (Appeals) set aside the Deputy Commissioner's order, stating that Notification No. 61/2002-C.E. had prospective effect from 23-12-2002 and could only be applied after the enactment of the Finance Act, 2003. The retrospective effect was attributed to the amendments only from the Finance Bill, 2003, i.e., 13-5-2003. The Revenue appealed this decision, leading to a hearing where it was argued that the refund claims had been correctly sanctioned by considering the Cenvat credit availed during the respective months when the sanction orders were passed. The appellate tribunal agreed with this argument, setting aside the Commissioner (Appeals) order and allowing the Revenue's appeal.

In conclusion, the tribunal held that the refund claims were appropriately sanctioned by considering the Cenvat credit availed during the relevant months, irrespective of the retrospective application of the amendment. The decision emphasized the importance of timely consideration of Cenvat credit in refund cases, leading to the allowance of the Revenue's appeal and the disposal of cross objections filed by the assessees accordingly.