2017 (6) TMI 265 - AT - Central Excise

Refund claim - The grievance of the appellant is that the original adjudicating authority, before rejection of the refund, never issued a show-cause notice detailing the grounds for proposed rejection of refund claim so that the appellant would have the opportunity to give their submissions - Held that - the original authority did not issue a SCN detailing the grounds under which the refund claim is proposed to be rejected - He has also failed to extend an opportunity to the appellant to make good any omissions such as furnishing copies of relevant agreements and other documents - matter remanded back to the original authority with the direction to issue a consolidated SCN detailing all the grounds under which the refund claim is proposed for rejection - appeal allowed by way of remand.

Summary

Issues:
Refund claim rejection on grounds of time bar and lack of relevant documents.

Analysis:
The appeal was against the rejection of a refund claim amounting to ?9,81,724/-, with a part of the claim rejected due to being time-barred and the rest rejected for not submitting relevant documents like purchase orders or agreements. The Commissioner(Appeals) rejected the appeal stating that no evidence was provided to show that the excise duty paid was not passed on to the buyers. The appellant argued that they were not given an opportunity to respond as no show-cause notice was issued before rejection. They also highlighted the failure to request the relevant documents before rejecting the claim. The appellant cited various case laws supporting the requirement of intimating grounds for rejection before the refund claim is rejected. They referred to CBEC instructions emphasizing the need for a show-cause notice before rejecting refund claims.

Upon review, it was found that the original authority did not issue a show-cause notice detailing the grounds for rejecting the refund claim or allow the appellant to provide necessary documents. The Tribunal set aside the impugned order and remanded the matter back to the original authority. The original authority was directed to issue a consolidated show-cause notice outlining all grounds for rejection and request all necessary documents from the appellant. The appellant was to be given an opportunity for a de novo adjudication with effective hearing, allowing additional documents as per law. The appeal was allowed by way of remand.