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2018 (5) TMI 1415 - AT - Service TaxRefund of unutilized CENVAT credit - rejection on the ground of time limitation - Section 11B of the Central Excise Act, 1944 - rejection on the ground that the application for refund of CENVAT credit was submitted after expiry of one year from the relevant date under Section 11B of CEA - Held that - the Commissioner (Appeals) has rightly relied upon the decision of the GTN Engineering (I) Ltd. 2011 (8) TMI 960 - MADRAS HIGH COURT wherein it has been held that Section 11B will be applicable for the purpose of claiming refund under Rule 5 of the CCR. This issue has been considered by the Hon ble Gujarat High Court in the case of Indo-Nippon Chemicals Co. Ltd. Vs. UOI 2002 (2) TMI 136 - GUJARAT HIGH COURT and the Hon ble High Court after considering the provisions of Section 11B as well as the CCR has come to the conclusion that Section 11B of the Act is applicable for the purpose of seeking of refund of CENVAT credit. There is a specific condition that the refund claims are required to be filed within the period specified under Section 11B - completely ignoring the provisions of Section 11B may not be appropriate. Section 11B is applicable for the purpose of computation of one year period for filing the refund claim and for export of service, the relevant date for the purpose of deciding the time limit for consideration of refund claim under Rule 5 of CCR will be the end of the quarter in which the FIRCs received. Refund is barred by limitation under Section 11B of the Act - appeal dismissed - decided against appellant.
Issues Involved:
1. Limitation period for filing refund claims under Section 11B of the Central Excise Act, 1944. 2. Applicability of Section 11B to refund claims of unutilized Cenvat credit under Rule 5 of the Cenvat Credit Rules, 2004. 3. Definition and relevance of the "relevant date" for computing the one-year limitation period for refund claims. Issue-wise Detailed Analysis: 1. Limitation Period for Filing Refund Claims: The core issue revolves around whether the refund claims filed by the appellant were within the limitation period as specified under Section 11B of the Central Excise Act, 1944. The Commissioner (Appeals) and the adjudicating authority both rejected the refund claims on the grounds that they were filed beyond the one-year period from the relevant date. The relevant date was considered to be the date of export of services. 2. Applicability of Section 11B to Refund Claims of Unutilized Cenvat Credit: The appellant argued that Rule 5 of the Cenvat Credit Rules, 2004 does not prescribe a limitation period for filing refund claims of unutilized Cenvat credit. They contended that the provisions of Section 11B, which prescribe a one-year limitation period for refund of duty of excise, should not apply to refunds of unutilized Cenvat credit. The appellant relied on various judicial decisions to support their argument that the refund of unutilized Cenvat credit should be treated differently from the refund of duty or service tax paid. 3. Definition and Relevance of the "Relevant Date": The appellant further argued that Section 11B does not define the "relevant date" for computing the one-year limitation period for refund claims of unutilized Cenvat credit. They contended that the absence of a defined relevant date for such refunds implies that no limitation period should apply. The appellant also cited Notification No. 14/2016 CE (NT) dated 01.03.2016, which specified the relevant date for service providers but argued that this notification should only apply prospectively. Tribunal's Findings and Judgment: 1. Limitation Period for Filing Refund Claims: The Tribunal upheld the decision of the Commissioner (Appeals), agreeing that Section 11B of the Central Excise Act, 1944, which prescribes a one-year limitation period for refund claims, is applicable to the refund of unutilized Cenvat credit. The Tribunal cited the decision of the Division Bench in Apotex Research Pvt. Ltd. and others, which concluded that the provisions of Section 11B apply to claims under Rule 5 of the Cenvat Credit Rules, 2004. 2. Applicability of Section 11B to Refund Claims of Unutilized Cenvat Credit: The Tribunal referenced the judgment of the Hon'ble Gujarat High Court in Indo-Nippon Chemicals Co. Ltd. vs. UOI, which held that Section 11B is applicable for seeking a refund of Cenvat credit. The Tribunal emphasized that the legislative intent, as indicated by Clause (c) of the proviso to sub-section (2) of Section 11B, supports the inclusion of refund claims based on Modvat credit within the scope of Section 11B. 3. Definition and Relevance of the "Relevant Date": The Tribunal referred to the Larger Bench decision in CCE, Bangalore vs. Span Infotech (India) Pvt. Ltd., which clarified that the "relevant date" for the purpose of computing the time limit for refund claims under Rule 5 of the Cenvat Credit Rules should be the end of the quarter in which the FIRCs (Foreign Inward Remittance Certificates) are received. The Tribunal concluded that the appellant's refund claims were time-barred as they were filed beyond the one-year period from the relevant date, as defined by the Larger Bench. Conclusion: The Tribunal dismissed all twelve appeals filed by the appellant, holding that the refund claims were barred by limitation under Section 11B of the Central Excise Act, 1944. The Tribunal affirmed the applicability of Section 11B to refund claims of unutilized Cenvat credit and clarified the relevant date for computing the one-year limitation period. The judgment emphasized adherence to the statutory provisions and judicial precedents in determining the limitation period for refund claims.
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