2018 (3) TMI 1848 - AT - Central Excise

Refund of CENVAT Credit - Tariff sub-heading was not given on three invoices issued to the manufacturers - for the seven invoices issued to the manufacturers for consignee name shows as M/s. Krishna Steel Enterprises whereas the goods were delivered to M/s. Nandish Alloys Ltd. - rejection of refund on the ground that the assessee did not make an application to Deputy Commissioner/Assistant Commissioner under Rule 9(2) of the Cenvat Credit Rules, 2004 - HELD THAT - On plain reading of this Rule, it is evident that there is no express requirement that the assessee should file an application before the Deputy Commissioner/Assistant Commissioner. The only requirement in the Rule is that the goods or taxable service covered by the impugned document should have been received and accounted for in the books of accounts of the receiver. Hence the insistence on filing an application is not justified. Instead, Deputy Commissioner/Assistant Commissioner, who was dealing with the refund claim, should have called the books of accounts of the assessee and satisfied himself. The matter is remanded back to the adjudicating authority to re-examine the refund claim of the appellants, who will produce the books of accounts to satisfy the Assistant Commissioner that the goods against the said invoices have been received and accounted for in their books of accounts by them - Appeal allowed by way of remand.

Issues:
Refund claim rejection based on non-compliance with Rule 9(2) of Cenvat Credit Rules, 2004.

Analysis:
The appellants, manufacturers of goods under Chapter 72 of the Central Excise Tariff Act, filed a refund claim of ?2,04,801 citing issues with invoices. The claim was rejected by the adjudicating authority and the appeal was dismissed by the Ld. Commissioner (Appeals). The Ld. Advocate for the appellants argued that Rule 9(2) of Cenvat Credit Rules, 2004 did not necessitate filing an application, and the Deputy Commissioner/Assistant Commissioner should have allowed the credit suo motu. The Ld. AR supported the Commissioner (Appeals) order. The Tribunal noted that Rule 9(2) requires goods covered by the document to be received and accounted for, without specifying the need for an application. Thus, the insistence on filing an application was deemed unjustified. The matter was remanded back to the adjudicating authority to re-examine the refund claim based on the books of accounts presented by the appellants to satisfy the Assistant Commissioner. The appellants were granted a fair opportunity to present their case.

This judgment primarily addresses the interpretation of Rule 9(2) of the Cenvat Credit Rules, 2004 regarding the procedure for claiming credit. The Tribunal clarified that the rule does not mandate the filing of an application by the assessee before the Deputy Commissioner/Assistant Commissioner. Instead, it emphasizes the requirement that goods covered by the document should be received and accounted for in the books of accounts. The Tribunal emphasized that the Deputy Commissioner/Assistant Commissioner should have verified the books of accounts to ascertain compliance with the rule, rather than insisting on an application from the assessee. The decision highlights the importance of adhering to the specific requirements of the rule and ensuring that the goods claimed for credit are properly documented and accounted for.

In conclusion, the Tribunal's decision to remand the matter back to the adjudicating authority for a fresh examination of the refund claim based on the books of accounts provided by the appellants demonstrates a fair and just approach to resolving the issue. By allowing the appellants the opportunity to present their case and ensuring compliance with the relevant rule, the Tribunal upholds the principles of natural justice and procedural fairness in tax matters. The judgment serves as a reminder of the importance of procedural compliance and proper documentation in claiming credits under the Cenvat Credit Rules, 2004.

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