2018 (8) TMI 794 - HC - Central Excise

Refund of unutilized Cenvat Credit - Credit was accumulated due to disproportionate rate of duty on inputs and final products availed at the time of surrender of Central Excise Registration. Revenue has fairly conceded that the issue involved in the present Appeal is squarely covered against the revenue in view of the decision of the Hon ble Supreme Court in Union of India Vs. M/s Slovak India Trading Co. Pvt. Ltd 2007 (1) TMI 556 - SUPREME COURT - In the aforesaid decision it is specifically observed and held that the dealer shall be entitled to the refund of unutilized Cenvat Credit on closure of factory. No substantial question of law arises in the present Appeal - appeal dismissed - decided against Revenue.

Summary

Issues:
1. Interpretation of law regarding reliance on previous tribunal decisions.
2. Allowance of refund of unutilized Cenvat Credit due to disproportionate rate of duty on inputs and final products.

Issue 1:
The appellant challenged the judgment of the Customs, Excise & Service Tax Appellate Tribunal (CESTAT) and raised questions regarding the reliance on a previous tribunal decision. The appellant questioned whether the Tribunal was correct in law to rely on the decision of the Ahmedabad Tribunal in a specific case, which was not accepted by the department and was pending before the High Court of Bombay. The appellant argued that this reliance was incorrect. However, during the hearing, the advocate for the revenue conceded that the issue in the present appeal was settled against the revenue by the Karnataka High Court and the Supreme Court in previous cases. The advocate referred to judgments confirming that a dealer is entitled to a refund of unutilized Cenvat Credit upon closure of a factory. Consequently, the court found that no substantial question of law arose in the present appeal, leading to the dismissal of the appeal.

Issue 2:
The second issue involved the allowance of a refund of unutilized Cenvat Credit accumulated due to a disproportionate rate of duty on inputs and final products at the time of surrender of Central Excise Registration. The Tribunal had allowed the refund in this case. The advocate for the revenue conceded that the issue was settled against the revenue based on previous judgments. The court referred to decisions by the Karnataka High Court, Bombay High Court, and the Supreme Court, which confirmed the entitlement of a dealer to a refund of unutilized Cenvat Credit upon closure of a factory. Consequently, the court dismissed the appeal, stating that no substantial question of law arose in this matter.