2017 (1) TMI 158 - AT - Central Excise

Refund - Time bar - Since in all the three appeals the learned Commissioner has not discussed the merits of the case and has merely rejected the refund claim only on time-bar except in Appeal No. E/27953/2013 wherein also substantial period from 01.01.2010 to 22.03.2010 has been held to be beyond limitation - Appeal allowed by way of remand.

Summary

Issues Involved:
- Refund of accumulated unutilized cenvat credit towards export
- Rejection of refund claim on the ground of time-bar under Section 11B of the Central Excise Act
- Applicability of limitation under Section 11B for refund of accumulated cenvat credit

Analysis:
1. The appellant, a 100% EOU manufacturing pharmaceutical products, filed three refund claims under Rule 5 of the Cenvat Credit Rules 2004 for accumulated unutilized cenvat credit towards export during specific periods. The adjudicating authority rejected the claims as time-barred under Section 11B of the Central Excise Act in the Order-in-Original. The first appellate authority also upheld the rejection on the grounds of limitation, leading to the appellant filing three appeals challenging these decisions.

2. The appellant argued that the limitation under Section 11B does not apply to issues related to refund of accumulated cenvat credit, citing a decision of the Hon’ble Karnataka High Court in a specific case. The counsel emphasized that the First Appellate Authority had previously allowed refund claims in similar cases based on the High Court's decision, highlighting the principle of judicial discipline that the original authority should follow higher authority's decisions on identical issues.

3. The learned counsel further referenced a Tribunal decision regarding the calculation of the limitation period based on the date of receipt of consideration. Additionally, a Tribunal decision from the Bombay Bench was mentioned, stating that the one-year period for refunds should be computed from the date the FIRC was received.

4. The AR, on the other hand, supported the findings of the impugned order, stating that as per Section 11B and a specific notification, refund claims must be filed within one year from the date of export of the goods in question.

5. After considering the arguments and precedents cited by both parties, the Tribunal found that the rejection of the refund claims solely on the basis of limitation was not legally sound. The Tribunal noted that the Commissioner had not discussed the merits of the case but had only rejected the claims on the grounds of time-bar. Therefore, the Tribunal set aside the impugned orders and remanded the cases back to the adjudicating authority for a reconsideration of the appellant's claims on merit.

6. The Tribunal directed the adjudicating authority to allow the appellant an opportunity to present evidence in support of their claims and to issue a reasoned order in accordance with the law. The authority was instructed to dispose of the appeals within three months from the receipt of the Tribunal's order. Consequently, all three appeals were allowed by way of remand, emphasizing the need for a thorough review of the refund claims beyond the limitation issue.