2017 (12) TMI 10 - AT - Central Excise

Refund claim - cash refund of cenvat credit - whether the appellant are entitled to refund of Cenvat Credit amount in cash when the credit was reversed on the insistence of the DGCI Officers as their factory has now been closed? - Held that - it has been held in similar circumstances by the Larger Bench of this Tribunal in the case of Steep Strips vs CCE Ludhiana 2011 (5) TMI 111 - CESTAT, NEW DELHI that cash refund cannot be allowed in absence of express provision in the statute for allowing such refund - appeal dismissed - decided against appellant.

Summary

Issues:
- Entitlement to refund of Cenvat Credit amount in cash when the factory is closed.

Analysis:
1. The appellant filed refund claims for reversed cenvat credit, rejected by the adjudicating authority and the Ld. Commissioner (Appeals). The appellant argued for cash refund as their factory was closed, citing precedents like CCE Vs Birla Textiles Ltd. and Shalu Synthetics Pvt. Ltd. Vs CCE Vapi. The Revenue opposed cash refund, referring to cases like Steep Strips Vs CCE Ludhiana and Scan Synthetics Ltd. Vs CCE, Jaipur-I.

2. The main question was whether the appellant could get a cash refund of unutilized Cenvat Credit due to factory closure. A reference to the Larger Bench was made in a similar case, questioning the entitlement for refund under the law. The Tribunal analyzed the law, including the judgment of the Hon'ble Karnataka High Court in Slovak India, concluding that refund of unutilized credit is only permissible in the case of exported goods, not for other reasons.

3. The Tribunal upheld the principle that refund of unutilized credit in cash is not permissible without an express provision in the statute. It emphasized that the law only recognizes refund for exported goods. The Division Bench also supported this view, stating that the Tribunal must follow the law declared by the Larger Bench and dismissed the appeal based on settled legal principles.

4. Considering the settled legal position, the Tribunal found no reason to interfere with the Ld. Commissioner (Appeals) order, upholding the rejection of the refund claim and dismissing the appeal on 28.11.2017.