2015 (12) TMI 1577 - AT - Central Excise

Refund claim - payment by cash before sanction of refund under Rule 5 of the Cenvat Credit Rules, 2004 - no minimum balance of AED - BED eligible for payment of AED - whether refund claim justified on the ground that BED was eligible for payment of AED? - Held that - there is no provision of law to entertain such claim for refund. The appellant paid amount due to the Government by cash instead of using credit, as claimed by them. There is no wrong payment. No amount has been paid in excess to the Government as there is no ground for any return of money by way of refund to the appellant - refund not justified - appeal dismissed - decided against appellant.

Summary

Issues: Refund claim under Rule 5 of Cenvat Credit Rules, 2004 for central excise duty paid in cash instead of using available credit balance.

Analysis:
1. The appeal was filed against the order dated 26-2-2006 passed by Commissioner (A)-II, Jaipur, rejecting the refund claim for central excise duty paid in cash before the sanction of refund under Rule 5 of the Cenvat Credit Rules, 2004. The appellants, engaged in the manufacture of cotton yarn and MM yarn, sought a refund of &8377; 1,23,056/- on the grounds that they had paid the amount by cash due to not having the minimum balance of AED in their account. Subsequently, they realized that the balance in BED was eligible for the payment of AED, leading to the refund claim for the duty paid in cash. The original authority and the Commissioner (A) both rejected the refund claim, prompting the appellant to file a second appeal before the Tribunal.

2. The appellant's counsel argued that the appellant could have utilized the available credit balance in their BED Account to pay the AED, and since they paid in cash, the amount should be refunded to them.

3. The Assistant Registrar reiterated the findings of the lower authorities, and after hearing both sides and examining the appeal records, the Tribunal proceeded with its analysis.

4. The Tribunal found no merit in the appellant's appeal, stating that there was no provision of law to entertain such a claim for refund. The appellant had paid the amount due to the Government in cash instead of utilizing the credit, as claimed by them. The Tribunal emphasized that there was no incorrect payment or excess amount paid to the Government, leading to the conclusion that there was no basis for a refund to the appellant. Consequently, the Tribunal upheld the findings of the lower authorities and dismissed the appeal.

5. The Tribunal pronounced the operative part of the order in the open court, stating that the appeal was dismissed, thereby concluding the legal judgment on the matter.