2012 (12) TMI 938 - AT - Central Excise

Refund claim - Denial of Refund claim - Held that - I have found no challenge to any of the factual findings recorded by the Commissioner (Appeals). As the refund claim was allowed on the basis of the aforesaid findings of the Commissioner (Appeals), his decision has got to be sustained for want of challenge to the factual findings - Decided against Revenue.

Summary

Issues:
- Appeal against the decision to allow a refund claim filed by the respondent
- Correlation between duty payment and input received in the factory
- Stipulated time for filing a refund claim
- Unjust enrichment
- Availment of CENVAT credit without using the material in the manufacture of final goods
- Identifiability of goods cleared under different invoices
- Payment of duty on clearances and filing of ER-1 returns
- Non-usage of impugned goods in the manufacture of final products

Analysis:
The appeal in question was filed by the department challenging the decision of the appellate Commissioner to allow a refund claim by the respondent. The respondent had received a specific quantity of MS wire under multiple invoices and claimed CENVAT credit. Subsequently, they cleared the same raw material without utilizing it in the manufacture of final goods, leading to a duty payment equal to the CENVAT credit taken. The refund claim was rejected initially due to a lack of correlation between the duty payment and the input received. However, the appellate authority found in favor of the respondent, noting that the refund claim was filed within the stipulated time, there was no unjust enrichment, and the goods were cleared on payment of duty without availing any exemption.

The Commissioner (Appeals) further observed that the respondent had received the MS wire, availed CENVAT credit, and subsequently paid duty on the same quantity, as per audit objections. The goods were cleared under different invoices, but the wire was identifiable, and duty payments were duly reported in the ER-1 returns. Importantly, the impugned goods for which CENVAT credit was taken were not used in the manufacture of final products, supporting the claim for a refund.

Upon review, the Judge found no challenge to the factual findings by the Commissioner (Appeals) in the present appeal. As the refund claim was allowed based on these findings, and no challenge was raised regarding the factual aspects, the decision of the Commissioner (Appeals) was upheld, leading to the dismissal of the appeal by the department. The judgment highlights the importance of factual findings in supporting refund claims and the significance of complying with duty payment regulations in the context of CENVAT credit utilization.