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2016 (8) TMI 196 - AT - Central ExciseRefund - portion of carry forward of unutilized credit - rule 5 of cenvat credit rules during the period credit utilized in the relevant quarters is more than the credit availed by the appellant - Revenue had contended that as per Clause-4 of Notification No. 05/2006-CE(NT) dated 14.03.006 only credit taken and utilized during a particular quarter has to be taken into consideration while sanctioning refund of unutilized credit relating to exports of finished goods in that particular quarter. Held that - assesse allowed refund of credit only when not in a position to utilized input credit/input service credit against goods exported - credit lying unutilized in the Cenvat credit account in the beginning of the quarter is not relevant when appellant is manufacturing and clearing goods both indigenously and for export and a common Cenvat credit with respect to inputs is taken refund claim not admissible decided in favor of revenue.
Issues Involved:
Refund of unutilized credit under Rule 5 of the Cenvat Credit Rules read with Notification No.05/2006-CE(NT) dated 14.03.006. Analysis: Issue 1: Refund of unutilized credit under Rule 5 of the Cenvat Credit Rules The Appeals were filed by the Revenue against Order-in-Appeal Nos. 6/CE/B-I/2012 and 7/CE/B-I/2012 passed by the Commissioner (Appeals), Bhubaneswar. The issue revolved around the refund of unutilized credit under Rule 5 of the Cenvat Credit Rules read with Notification No.05/2006-CE(NT) dated 14.03.006. The Revenue contended that only credit unutilized with respect to inputs used in the finished goods exported during the relevant quarter should be considered for refund, while the appellant argued for a broader interpretation. The respondent relied on case law to support their claim for refund based on the unutilized credit at the beginning of the quarter. Issue 2: Interpretation of Notification No. 05/2006-CE(NT) dated 14.03.006 The main contention was whether the conditions of Notification No. 05/2006-CE(NT) dated 14.03.006 were fulfilled for granting the refund. The Revenue argued that only credit taken and utilized during a specific quarter should be considered for refund, while the appellant argued for a different interpretation. The case records showed that the appellant had utilized more credit than accrued during the relevant quarter, unlike the situation in previous cases. The judgment highlighted the specific condition under the notification regarding the refund of unutilized credit against goods exported during the given period. Issue 3: Admissibility of Refund Claim The Tribunal analyzed the facts and legal provisions to determine the admissibility of the refund claim. It was observed that the conditions for refund under the relevant notification were not met in the present case, as the credit lying unutilized at the beginning of the quarter was deemed irrelevant when considering the common Cenvat credit for both domestic and export purposes. The Tribunal concluded that the refund claims during the relevant quarters were not admissible to the appellant, leading to the allowance of the appeals filed by the Revenue and the restoration of the Orders-in-Original by setting aside the Orders-in-Appeal passed by the First Appellate Authority. This detailed analysis of the judgment provides a comprehensive understanding of the issues involved and the Tribunal's decision regarding the refund of unutilized credit under the Cenvat Credit Rules.
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