2017 (9) TMI 912 - AT - Central Excise

Refund of accumulated CENVAT credit - benefit of N/N. 30/04-CE dated 9-7-2004 - rejection on the ground that only provision under refund of accumulated Cenvat credit is under Rule 5, which is specifically against export of goods and accumulated Cenvat credit due to exports - Held that - if accumulation of the credit is due to export of the goods appellant is entitle for the refund, as they have opted exemption N/N. 30/2004, the appellant is unable to use of accumulated Cenvat credit, therefore on opted of exemption N/N. 30/04-CE the accumulated Cenvat credit on account of exports is refundable - Since lower authority has not examined whether accumulated cenvat credit is on account of export of the goods, matter needs to be re-considered - appeal allowed by way of remand.

Summary

Issues:
Refund claim based on accumulated Cenvat credit due to exports under notification No. 30/04-CE dated 9-7-2004.

Analysis:
The appellant filed a refund claim of ?29,98,629 on the ground of availing exemption from excise duty on goods manufactured under notification No. 30/04-CE from 1-4-2007, resulting in unutilized Cenvat credit. The claim was rejected by the adjudicating authority citing Rule 5, which pertains to refund of accumulated Cenvat credit specifically for exports. The Commissioner(Appeals) upheld the rejection, leading to the appeal before the Tribunal.

The appellant argued that the accumulation of credit was not only due to domestic clearances but also exports from 2003-04 to 2006-07, justifying the refund claim. Several judgments were cited to support this argument. On the contrary, the Revenue contended that accumulated credit unrelated to exports does not warrant a refund, referencing the Gauri Plasticulture case. The Tribunal noted the lack of examination by lower authorities on whether the accumulated credit was indeed linked to exports.

Considering the appellant's claim of credit accumulation due to exports and the chosen exemption under notification No. 30/04-CE, the Tribunal found merit in the appeal. It held that if the credit accumulation stemmed from goods exported, the appellant was entitled to a refund. Since this crucial aspect was overlooked by the lower authorities, the Tribunal set aside the impugned order and remanded the matter for a fresh decision, emphasizing the need to assess if the accumulated Cenvat credit was a result of exporting goods. The appeal was allowed for reconsideration by the adjudicating authority.