2018 (8) TMI 1906 - HC - Central Excise

Rebate on exported goods - revisional authority rejected the petitioner's case for rebate on the exported goods, however, on the ground that the Government cannot retain an amount which is not due to it - section 142 of the CGST Act, 2017 - HELD THAT - Counsel contended that the CENVAT Credit should have been paid in cash since the revision order was passed after 01.07.2017. NOTICE, returnable on 31.08.2018.

Summary

Issues:
Challenge to revision order regarding duty paid inputs and goods for export; Interpretation of CENVAT Credit under GST regime post 01.07.2017.

Analysis:
The petitioner contested a revision order that deemed duty paid inputs for exported goods as unauthorized, thus rejecting rebate claim but directing re-credit of the amount in CENVAT Credit Account. The petitioner did not dispute the revisional authority's reasoning but highlighted the impact of the GST regime effective from 01.07.2017 on CENVAT Credit. Reference was made to Section 142(3) of the Central Goods and Services Tax Act, 2017, emphasizing that refund claims for CENVAT credit post the GST regime should be settled in cash, irrespective of previous laws, except for specific provisions. The petitioner argued that the CENVAT Credit should have been reimbursed in cash due to the revision order being issued after the GST implementation.

The legal debate centered on the treatment of CENVAT Credit post-GST regime in light of the revision order rejecting the rebate claim for duty paid inputs on exported goods. The petitioner's reliance on Section 142(3) of the CGST Act, 2017, underscored the mandatory cash refund provision for CENVAT credit claims made after 01.07.2017. This statutory provision aimed to ensure the proper disposal of refund claims and the payment of accrued amounts in cash, emphasizing the legislative intent to streamline refund processes under the new tax regime. The petitioner's argument sought to align the revision order's outcome with the statutory framework of the GST laws, emphasizing the need for consistent application and adherence to the post-GST refund mechanisms for CENVAT Credit claims.

The court scheduled a returnable notice for further proceedings, indicating a judicial acknowledgment of the complex interplay between the revision order's implications on duty paid inputs for exported goods and the statutory provisions governing CENVAT Credit refunds post the GST regime's implementation. The upcoming hearing on 31.08.2018 suggested a forthcoming legal examination of the petitioner's contentions regarding the cash refund entitlement for CENVAT Credit under the revised tax framework, underscoring the significance of resolving the interpretational conflict between the revision order and the post-GST refund mechanisms for duty paid inputs on exported goods.