2001 (2) TMI 213 - AT - Central Excise

Summary

Issues involved: Whether refund of duty paid through Modvat credit account (RG 23A Part II) is payable in cash to the customer of the excisable goods.

Summary:
The appeal before the Appellate Tribunal CEGAT, Chennai involved the question of whether a refund of duty paid through Modvat credit account (RG 23A Part II) should be paid in cash to the customer of excisable goods. The Revenue contended that Modvat Rules do not allow for cash refund of duty paid through RG 23A Part II, while the Respondents argued that such payment should be eligible for cash refund under Section 11B of the Central Excise Act. The Tribunal considered the submissions and held that while duty paid through RG 23A Part II is refundable if paid in excess, it cannot be refunded in cash as it is a credit account to eliminate duty cascading. The refund is admissible to the customer as the duty incidence has been passed on to them. The Tribunal distinguished various cases cited by the parties to support their arguments and concluded that the refund amount should be given in the RG 23A Part II account if operational, without allowing cash refund.