2015 (10) TMI 1346 - AT - Central Excise

Denial of refund claim - Denial of exemption claim - Held that - Both the authorities below observed that refund claim is premature as the de-novo adjudication is still pending. On a query from the Bench, the learned Advocate for the appellant submits that the Tribunal passed the order in 2011 and de-novo adjudication is still pending. In my considered view, as the de-novo adjudication is pending before the Commissioner and therefore, the matter may be remanded to the Commissioner to decide afresh. - impugned order is set-aside. The matter is remanded to Commissioner - Decided in favour of assessee.

Summary

Issues:
1. Prematurity of the refund claim due to pending de-novo adjudication

Analysis:
The case involved the appellant, engaged in Castrol Oil manufacturing, availing CENVAT credit on inputs for both dutiable and exempted final products. A show cause notice was issued proposing a demand based on the value of exempted goods under CENVAT Credit Rules. The Commissioner confirmed the demand, which was paid by the appellants. Subsequently, the Tribunal set aside the Commissioner's order and remanded the matter for decision under the provisions of the Finance Act, 2010 regarding the reversal of the amount of exempted goods. Meanwhile, the appellant filed a refund claim for the amount paid. However, a show cause notice was issued rejecting the refund claim as premature. The adjudicating authority and the Commissioner (Appeals) upheld the rejection, leading to the appellant filing an appeal against the refund claim rejection.

Upon hearing both sides and reviewing the records, the presiding judge noted that the lower authorities deemed the refund claim premature due to the pending de-novo adjudication. The appellant's advocate confirmed that the Tribunal's order from 2011 was still pending adjudication. Consequently, the judge opined that since the de-novo adjudication was ongoing before the Commissioner, the matter should be remanded to allow the Commissioner to decide afresh. Therefore, the impugned order was set aside, and the case was remanded to the Commissioner with directions to address the pending de-novo adjudication in line with the Tribunal's order. Emphasizing the age of the matter, the Commissioner was instructed to expedite the decision-making process. Ultimately, the appeal was allowed through remand, providing a way forward for the pending refund claim issue.