2008 (9) TMI 331 - AT - Central Excise

Refund of unutilized cenvat credit - Revenue has not rejected the entire refund claim - Original authority has granted the refund of credit attributable to the exported products based on the information given by the appellants - In terms of Rule 5 of the Cenvat Credit Rules only refund of credit used in the export of goods is allowed - the unutilised credit lying in their balance includes the credit attributable to inputs lying in stock inputs used in in-process etc therefore credit to that extend can not be refunded.

Summary

Issues:
Claim for refund of Cenvat credit on exported goods.

Analysis:
The appeal was filed against the Order-in-Appeal passed by the Commissioner of Central Excise. The appellants availed Cenvat credit on inputs used in the production of exported goods and filed a refund claim. The Original authority partially sanctioned the claim, stating that the credit includes various components like duty credit on stock of inputs and in-process finished goods. The appellants approached the Commissioner (Appeals) who upheld the Original authority's decision, stating that refund is available only for inputs used in the production of goods exported during the claim period. The Tribunal noted the appellants' reliance on case laws supporting refund of credit for exported final products that cannot be utilized immediately. However, after examining the records, the Tribunal found that the Revenue had not rejected the entire refund claim, as the Original authority had granted refund based on information provided by the appellants. The Tribunal upheld the lower authority's decision, stating that only credit used in the export of goods is eligible for refund under Rule 5 of the Cenvat Credit Rules. Consequently, the appeal was rejected.

In conclusion, the Tribunal dismissed the appeal, affirming the decision of the lower authorities that the refund claim for Cenvat credit on exported goods was only eligible for the credit used in the export of goods, as per Rule 5 of the Cenvat Credit Rules. The Tribunal emphasized that the Revenue had not rejected the entire refund claim and had granted refund for credit attributable to the exported products based on the information provided by the appellants. The case laws cited by the appellants were considered, but the Tribunal found no infirmity in the lower authority's order, thereby denying the appeal for further relief.