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2024 (2) TMI 301 - HC - Central ExciseRejection of refund on the ground of time limitation - Constitutional Validity of Rule 5 of the Cenvat Credit Rules, 2004 - paragraph 3(b) of Notification No. 27/2012-CE(NT) dated 18.06.2012 enclosed as Annexure-B prescribing a time limit for claiming refund of cenvat credit - HELD THAT - In the instant case, it is not in dispute that the returns filed by the assessee have been accepted - However, the question in this appeal is with regard to the rejection of refund claim on the ground of limitation. In MPORTAL INDIA WIRELESS SOLUTIONS (P.) LTD. VERSUS COMMISSIONER OF SERVICE TAX 2011 (9) TMI 450 - KARNATAKA HIGH COURT , this Court has held that Section 11B is not applicable. The Commissioner (Appeals), as also the CESTAT have not returned any finding with regard to applicability of empowerment. Therefore, the matter requires reconsideration in the hands of the Original Authority. Petition allowed by way of remand.
Issues involved:
The issues involved in the judgment are the rejection of refund claim by the Original Authority based on limitation, the applicability of Section 11B of the Central Excise Act, 1944 for refund claims made under Rule 5 of the Cenvat Credit Rules 2004, and the acceptance of returns by the Tax Authority in relation to refund claims. Rejection of Refund Claim based on Limitation: The writ petition was filed by the assessee challenging the rejection of the refund claim for the claim period 2011-12, 2012-13, and 2013-14. The Commissioner (Appeals) partially upheld the rejection for A.Ys. 2011-12 and 2012-13 but remitted the matter to the Original Authority for A.Y. 2013-14. The CESTAT dismissed the assessee's appeal and allowed the appeal filed by the Revenue, resulting in the restoration of the Original Authority's order. The assessee contended that the rejection was solely on the ground of limitation, which was incorrectly upheld by the CESTAT. The matter was to be remitted to the Original Authority for further consideration. Applicability of Section 11B of the Central Excise Act, 1944: The Revenue argued that Section 11B of the Central Excise Act, 1944 is applicable for refund claims made under Rule 5 of the Cenvat Credit Rules 2004. The Revenue relied on a previous judgment to support their stance. The case of mPortal, which involved an Export Oriented Unit (EOU) with similar circumstances, was cited as a precedent. Acceptance of Returns by the Tax Authority: The advocate for the petitioner referred to a Delhi High Court judgment in BT (India) Pvt. Ltd., which highlighted that once returns are accepted by the Tax Authority, rejecting refund claims would disrupt the assessment orders. The judgment emphasized that the processing of refunds is akin to execution proceedings and does not allow for a fresh assessment on merits. The Court found merit in the arguments presented but emphasized that the issue in this appeal pertained to the rejection of the refund claim on the grounds of limitation. The Court ordered the matter to be reconsidered by the Original Authority. Conclusion: The High Court set aside the orders passed by the CESTAT and remitted the matter to the Original Authority for reconsideration in accordance with the law. The Court kept all contentions of both parties open and did not award any costs in this matter.
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