2018 (4) TMI 57 - AT - Central Excise

Refund claim - time limitation - section 11B of CEA - whether the appellant s refund is hit by limitation or otherwise? - Held that - the refund is in respect of the amount which was debited and involved in the litigation which was pending before the adjudicating authority. Therefore before the adjudication of the demand of cenvat credit no refund could have arisen. The refund has arisen only after the adjudication order was passed on 31.12.2015 - the period of one year provided under Section 11B should be reckoned from the date of such adjudication order from the said date the appellant has filed refund within one year. Refund claim is filed within time limit - appeal allowed - decided in favor of appellant.

Summary

Issues:
1. Whether the appellant's refund claim is time-barred under Section 11B?
2. Whether the refund claim is maintainable based on the order of the Additional Commissioner?
3. Applicability of clause (ec) of Section 11B(5)(B) in the present case.

Analysis:
1. The appellant's refund claim was initially sanctioned by the adjudicating authority in relation to the excess amount debited by the appellant. The appellant reversed cenvat credit of ?22 lakhs and paid interest before a show cause notice was issued for denial of credit of approximately ?48 lakhs. The Additional Commissioner confirmed a demand of ?5,72,217/- and interest of ?21,634. The Revenue appealed, contending that the refund was time-barred as it was filed after one year from the reversal of credit. However, the appellant argued that the refund claim was filed within one year of the adjudication order by the Additional Commissioner, relying on various judgments supporting their position.

2. The appellant's counsel argued that the refund claim was filed within the prescribed time under Section 11B, as it was consequent to the order of the Additional Commissioner. The counsel cited judgments such as Opel Alloys Pvt. Ltd. and Clariant (I) Ltd. to support the argument that the refund claim should be reckoned from the date of the adjudication order confirming part of the demand against the total reversal of credit. On the other hand, the Revenue's representative reiterated the findings of the impugned order, emphasizing that the refund did not fall under the exclusion provided in clause (ec) of Section 11B(5)(B) as it was not based on a judgment, decree, or order of an appellate authority or court.

3. The tribunal analyzed the submissions and observed that the refund claim was in relation to the amount debited and involved in the pending litigation before the adjudicating authority. The tribunal concluded that the refund arose only after the adjudication order was passed, and therefore, the period of one year under Section 11B should be reckoned from the date of the adjudication order. The tribunal also found that clause (ec) was applicable in this case, as the refund became payable following the order passed by the Additional Commissioner. The tribunal distinguished the case cited by the Revenue, USV Ltd., stating that it had different facts compared to the present case. Ultimately, the tribunal set aside the impugned order, allowing the appeal with consequential relief and disposing of the cross objection.