2011 (6) TMI 660 - AT - Central Excise

Refund claim of deemed credit - refund claim has been rejected firstly on the ground that the appellant has failed to produce the evidences and secondly on the ground that they have not complied with the Notification No. 11/2002 Held that - appellant has complied with condition 5 of the Notification 11/2002 therefore the appellants are entitled for the refund claim filed by them subject to verification of the records which have not been examined by the lower authorities, appeal is allowed by way of remand

Summary

Issues:
Appeal against denial of refund claim for unutilized deemed credit accumulated as on 31st March, 2003.

Detailed Analysis:
1. Facts of the Case:
The appellants, engaged in manufacturing man-made fabrics, filed a refund claim of Rs.1,35,550/- for unutilized deemed credit along with inputs used in goods exported under bond. The claim was rejected by lower authorities leading to the appeal.

2. Appellant's Arguments:
The appellant's counsel argued that the appellants met the conditions of Notification No. 6/2002 and were entitled to the refund claim under Rule 5 of CENVAT Credit Rules, 2001. They contended that the credit accumulated under the rescinded notification could not be utilized post its rescission on 1st April, 2003.

3. Respondent's Arguments:
The learned SDR argued that as per judicial precedents, the appellants could utilize the unutilized credit post 31st March, 2003. Refund could only be claimed if the credit remained unutilized, which was not the case here according to the SDR.

4. Tribunal's Decision:
After considering submissions and the impugned order, the Tribunal found that the refund claim rejection was based on the appellant's failure to produce evidence and non-compliance with Notification No. 11/2002. However, upon review, the Tribunal concluded that the appellants were entitled to the refund claim under the conditions specified in the notification.

5. Judicial Precedents:
The Tribunal noted that in similar cases, it was held that the appellants could utilize the unutilized credit post the specified date. The Tribunal directed the matter to be sent back to the adjudicating authority for verification of documents supporting the refund claim.

6. Outcome:
The Tribunal allowed the appeal by way of remand, instructing the adjudicating authority to dispose of the matter within one month of receiving the order.

This detailed analysis outlines the key arguments presented by both parties, the Tribunal's decision based on legal provisions and precedents, and the final outcome of the appeal.