2017 (12) TMI 1293 - AT - Central Excise

100% EOU - refund claim - time limitation - section 11B of CEA, 1944 - scope of SCN - Held that - It would appear that the two lower authorities have not borne in mind the allegations made in the show cause notice, as well as the submissions of the appellant that they had furnished the necessary documents along with the claim for refund - the matter remanded back to the original authority to determine such of the refund claims which has been disallowed by the first appellate authority on the ground of non-segregation of utilization between the domestic tariff area unit and to the export oriented unit.

Summary

Issues:
Refund claims rejection based on deficiencies in CENVAT credit eligibility and refund eligibility, limitation prescribed in section 11B of Central Excise Act, 1944, non-exclusivity of services utilized in the export oriented unit, denial of refund by lower authorities, scrutiny of claims with reference to documents, necessity of segregation of utilization between units.

Analysis:
The case involves a dispute regarding refund claims filed by an Export Oriented Unit for specific quarters. The Commissioner of Central Excise (Appeals) rejected the refund claims citing deficiencies in CENVAT credit eligibility and refund eligibility, including a claim amount barred by limitation under section 11B of the Central Excise Act, 1944. The appellant contended that the delayed credit pertained to the claim period and all required documents were submitted, as acknowledged in the show cause notice itself.

The Authorized Representative argued that services were not exclusively utilized in the export unit, making the refund inadmissible without segregation. The first appellate authority partially allowed the refund but disallowed specific amounts due to lack of segregation. The appellate tribunal noted that lower authorities failed to consider the appellant's submissions and documents, emphasizing the entitlement of exporters to tax refunds on 'input services' unless specifically barred by law.

Referring to Rule 5 of CENVAT Credit Rules, the tribunal highlighted the need for thorough scrutiny of refund claims to ensure entitlements are not denied unjustly. The tribunal set aside the impugned order and remanded the matter to the original authority for determining refund claims disallowed due to non-segregation of service utilization between units. This decision aimed to uphold the safeguards and conditions for refund grants under the CENVAT Credit Rules, emphasizing the importance of proper documentation and segregation in claiming refunds for services utilized in export-oriented units.

This detailed analysis of the judgment showcases the complexities involved in refund claims for Export Oriented Units, emphasizing the legal requirements, documentation scrutiny, and the necessity of segregation in service utilization to determine refund eligibility accurately.