2009 (8) TMI 1071 - AT - Central Excise

Summary

Issues:
1. Refund claim rejection for non-compliance with conditions in Notification No. 11/2002-C.E. (N.T.) and for availing drawback or rebate.
2. Denial of credit due to erroneous input documents.

Analysis:
The judgment by the Appellate Tribunal CESTAT CHENNAI addressed the issues arising from the impugned order of the Commissioner of Central Excise (Appeals). The Commissioner remitted the issues regarding the rejection of a refund claim amounting to Rs. 42,25,734/- for non-compliance with conditions in Notification No. 11/2002-C.E. (N.T.) and for availing drawback or rebate. Additionally, the denial of credit of Rs. 9,03,190/- was upheld due to erroneous input documents. The assessees contended that the denial of credit was not proposed in the show-cause notice, thus challenging its sustainability.

Upon hearing both sides, it was noted that the show-cause notice proposed the rejection of the refund claim for non-compliance with conditions in the said Notification and for availing drawback or rebate. However, the notice did not include the denial of credit of Rs. 9,03,190/- based on erroneous input documents. Consequently, the Tribunal agreed with the assessees' consultant that the denial of credit amounting to Rs. 9,03,190/- was not sustainable. Therefore, the Tribunal set aside the denial of this amount. Furthermore, the Tribunal clarified that the refund claim of Rs. 42,25,734/- needed to be reconsidered solely on the aspects of compliance with the conditions in the Notification and the permissibility of refund when drawback or rebate of duty is claimed.

In conclusion, the appeal was allowed in favor of the assessees, with the Tribunal directing a fresh consideration of the refund claim on the specific issues identified, while also overturning the denial of credit due to erroneous input documents.