2000 (2) TMI 434 - AT - Central Excise

Summary

Issues:
1. Maintainability of the refund claim under Section 11B(2) of the Central Excise Act.
2. Entitlement to refund of Modvat credit reversed at the instance of the department.
3. Interpretation of Notification No. 204/92-Cus. dated 19-5-1992 regarding transfer of DEEC license.

Issue 1:
The Appellants filed a refund claim under Section 11B of the Central Excise Act, claiming entitlement to Modvat credit under Rule 57A of the Central Excise Rules. The Assistant Commissioner rejected the claim, stating it was not maintainable under Section 11B(2). The Commissioner (Appeals) upheld the rejection on merits. The Appellants appealed to the Tribunal, arguing that the refund should have been allowed as there was no requirement to reverse the Modvat credit under Notification No. 204/92-Cus. dated 19-5-1992. The Tribunal noted the grounds of appeal but ultimately dismissed the appeal, upholding the lower authorities' decision on the maintainability of the refund claim.

Issue 2:
The Appellants reversed Modvat credit on Veneers under departmental compulsion after transferring their DEEC license to a third party. They sought a refund of the reversed amount, contending that there was no condition in the notification mandating such reversal. The Departmental Representative argued that the Appellants were not entitled to transfer the license without reversing the credit on Veneers used in the exported products. The Tribunal examined the notification and concluded that the Appellants were not entitled to the refund as they had availed credit on Veneers used in the exported goods, necessitating the reversal of the credit for lawful transfer of the license. The Tribunal upheld the lower authorities' decision, denying the refund claim.

Issue 3:
The interpretation of Notification No. 204/92-Cus. dated 19-5-1992 regarding the transfer of the DEEC license was crucial. The Appellants argued that the notification did not require the reversal of Modvat credit on exported goods for license transfer. However, the Departmental Representative contended that the Appellants should have reversed the credit on Veneers before transferring the license. The Tribunal analyzed the notification's condition, emphasizing that the Appellants needed to reverse the credit to lawfully transfer the license. As the reversal was not done under departmental compulsion, the Tribunal upheld the lower authorities' decision, dismissing the appeal based on the notification's interpretation.