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2022 (2) TMI 456 - AT - Service TaxRefund of CENVAT Credit - credit remained unutilized on closure operation - HELD THAT - The case law relied upon by the ld.AR has been examined by this Tribunal in the case of M/S SHRI GURU HARGOBIND STEEL INDUSTRIES VERSUS COMMISSIONER OF CE ST, LUDHIANA 2020 (12) TMI 753 - CESTAT CHANDIGARH and in the case of M/S. SHREE KRISHNA PAPER MILLS AND IND. LIMITED VERSUS COMMISSIONER OF CENTRAL EXCISE AND ST., GURGAON 2018 (4) TMI 1155 - CESTAT CHANDIGARH , where it was held that The issue of non-entitlement of Cenvat credit cannot be raised at the stage of entertaining refund claim without challenging the availment of Cenvat credit. This Tribunal in the case of KIRLOSKAR TOYOTA TEXTILE MACHINERY PVT. LTD. VERSUS COMMISSIONER OF CENTRAL TAX, BENGALURU SOUTH GST COMMISSIONERATE 2021 (8) TMI 818 - CESTAT BANGALORE had an occasion to examine the issue and after examining the various judicial pronouncement on the issue has allowed the cash refund of credit lying unutilized on closure of the operation on 19.08.2021 - the appellant is entitled to cash refund under Rule 5 of Cenvat Credit Rules, 2004 of the credit lying unutilized in their Cenvat credit account on closure of operation. Appeal is allowed - decided in favor of appellant.
Issues:
Refund claim of credit remained unutilized on closure of operation. Analysis: The appellant, a manufacturer of electricity meters, filed a refund claim under Rule 5 of Cenvat Credit Rules, 2004 for unutilized credit on closure of operation. The claim was rejected by authorities. The appellant argued citing precedents like Rama Industries Ltd. and various case laws supporting their claim for cash refund. The respondent contended that no cash refund is permissible without statutory provisions, referring to Rule 5 amendment in 2012. The Tribunal examined precedents like Shri Guru Hargobind Steel Industries and M/s.Shree Krishna Paper Mills Ltd., where cash refund was allowed in similar cases. Notably, in the case of JU Pesticides vs. CCE, cash refund was granted by the Tribunal. The Tribunal also considered the ruling of Nichiplast India Pvt.Ltd. vs. Principal Commissioner of CGST & Central Excise, Delhi, supporting cash refund. The Tribunal referred to the case of Kirlosker Toyota Textile Machinery, where cash refund was allowed for unutilized credit on closure of operation. Based on these judicial pronouncements, the Tribunal held that the appellant is entitled to cash refund under Rule 5 of Cenvat Credit Rules, 2004. Consequently, the impugned order was set aside, and the appeal was allowed with any consequential relief. The judgment was pronounced on 04.02.2022.
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