2012 (8) TMI 285 - AT - Service Tax

Non comply with condition No.1 (ii) of Notification No.42/2001 - claim the refund rejected - Application seeking waiver of pre-deposit and stay of recovery - Held that - As the assessee was required to export the goods within six months from the date on which the goods were cleared from the factory for export, the appellant cleared the goods for export on 21.11.2008 and exported it on 14.12.2008 after obtaining the necessary let export order from the proper officer of customs,thus, the relevant condition of the Notification was complied with and hence the assessee could claim the refund - grant of waiver of pre-deposit and stay of recovery.

Summary

Issues:
1. Waiver of pre-deposit and stay of recovery sought by the appellant in relation to duty refund.
2. Compliance with conditions under Notification No.42/2001 for duty refund on exported goods.

Analysis:
1. The appellant filed an application seeking waiver of pre-deposit and stay of recovery for a duty refund of Rs.95,594. The refund amount had been collected by the appellant following due process, but the department appealed for recovery based on non-compliance with a specific condition. Notably, no show-cause notice was issued under Section 11A of the Central Excise Act for recovery due to an erroneous refund. The appellate Commissioner's order for recovery was based on the appellant's alleged failure to comply with condition No.1 (ii) of Notification No.42/2001 issued under Rule 19 of the Central Excise Rules, 2002. The appellant had exported goods under the ARE-1 procedure, with the relevant shipping bill assessed by the customs officer. Although the consignment was claimed to have been shipped late, the appellant eventually produced the required ARE-1 document. The Tribunal found that the appellant had complied with the conditions of the Notification, allowing for a prima facie case in favor of the appellant's refund claim.

2. Upon review of the facts and relevant legal provisions, the Tribunal determined that the appellant had met the necessary conditions for the duty refund under Notification No.42/2001. The Tribunal acknowledged that the goods were cleared for export and exported within the prescribed timeline, as per the conditions outlined in the Notification. Consequently, the Tribunal granted the waiver of pre-deposit and stay of recovery in respect of the duty amount, recognizing the prima facie case presented by the appellant. The decision was made based on the compliance demonstrated by the appellant with the conditions specified under the relevant Notification, ensuring the appellant's entitlement to the duty refund.

This judgment by the Appellate Tribunal CESTAT, Bangalore, delivered by P G Chacko, J., provides a detailed analysis of the appellant's request for waiver of pre-deposit and stay of recovery concerning a duty refund. The Tribunal meticulously examined the compliance of the appellant with the conditions stipulated under Notification No.42/2001, ultimately granting relief to the appellant based on the prima facie case established in favor of the duty refund claim.