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2006 (2) TMI 316 - AT - Central ExciseRefund consequent to finalisation of provisional assessment - non speaking order - HELD THAT - The appellants were repeatedly approaching the Assistant Commissioner for grant of the refund. However, while granting the refund a part of the amount was ordered to be credited to RG 23A Part-II Account. The authorities have not heeded to the request of the appellant that the amount should be paid in cash/cheque as the unit was closed. The attitude of the Departmental Authorities appears to be very negative and unsympathetic. Various decisions are available holding that refund is to be given in cash where the assessee is not in a position to utilise the refund granted in credit account. The Commissioner (Appeals) also has not examined the issue in the proper perspective. We find that when the Commissioner (Appeals) granted relief to the appellants in his order dated 10-7-2003, the department, filed a stay application but the Tribunal rejected departmental request for stay. Inspite of the above fact, the department has not sanctioned the full refund due to the appellants on some pretext or the other. The entire sequence of events in this sorry episode is a sad commentary on the working of the Central Excise Department. We hope that this would be well taken by the powers that be to initiate remedial action. Thus, we allow the appeal with consequential relief.
Issues:
1. Refund disbursement procedure in case of closed unit. 2. Failure of authorities to grant refund in cash. 3. Applicability of case laws on refund disbursement. Detailed Analysis: Issue 1: Refund disbursement procedure in case of closed unit The appeal in this case was against the Order-in-Appeal passed by the Commissioner of Central Excise (Appeals), Bangalore, regarding the disbursement of a refund of Rs. 30,71,465/- sanctioned by the Assistant Commissioner after finalization of provisional assessment for the period from 1995 to 1999. The Assistant Commissioner had ordered a part of the refund to be paid in cash and the rest to be credited in the RG 23 A Part II Register. The appellants, whose unit was closed, requested the refund to be disbursed by cheque/cash. However, the Assistant Commissioner stated that the refund had already been sanctioned, and no further action was required from him, as a show cause notice was pending with the Commissioner for disposal. The Commissioner (Appeals) dismissed the appeal, citing the Assistant Commissioner's letter as not a speaking order. The appellants, aggrieved by this decision, approached the Tribunal seeking relief. Issue 2: Failure of authorities to grant refund in cash Despite being entitled to the refund, the appellants faced challenges in receiving the full amount in cash due to the attitude of the Departmental Authorities, which appeared negative and unsympathetic. The authorities did not heed the appellants' request for cash disbursement, even though various decisions and case laws highlighted the necessity of providing refunds in cash when the assessee is unable to utilize the credit account. The Tribunal noted that the refund of Rs. 30,71,465/- had already attained finality through previous orders, and the Departmental Authorities' reluctance to disburse the amount in cash was criticized as a sad commentary on the working of the Central Excise Department. Issue 3: Applicability of case laws on refund disbursement The Tribunal highlighted several case laws, such as MRF Ltd v. CCE, Sandoz (India) Ltd. v. CCE, and others, emphasizing the requirement to provide refunds in cash when necessary. The Commissioner (Appeals) was criticized for not examining the issue properly and failing to grant the full refund due to the appellants, despite previous orders in their favor. The Tribunal observed a lack of cooperation from the Departmental Authorities, leading to a sequence of events reflecting poorly on the functioning of the Central Excise Department. Ultimately, the Tribunal allowed the appeal with consequential relief, emphasizing the need for remedial action to address the issues faced by the appellants in receiving their entitled refund amount. (Operative portion of this Order was pronounced in open court on conclusion of hearing)
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