2017 (3) TMI 1440 - AT - Central Excise

Cash refund - unutilized CENVAT credit - N/N. 50/2005-CE dated 10.06.2003 - Held that - the similar issue came up before this Tribunal in the case of M/s Max Power Infosystems 2017 (1) TMI 1185 - CESTAT CHANDIGARH , where reliance was placed in the case of APCO Pharma Ltd. 2011 (10) TMI 38 - UTTARAKHAND HIGH COURT , where it was held that in a situation where the assessee is not in a position to utilize the Cenvat Credit Account, the refund claim is to be given in cash - refund allowed in cash - appeal dismissed - decided against Revenue.

Summary

Issues:
- Appeal against the impugned order allowing refund in cash
- Refund claim filed under exemption Notification No.50/2005-CE
- Dispute over refund credited to cenvat credit account
- Interpretation of Section 11B of the Act for refund claims
- Precedent set by M/s Max Power Infosystems case
- Application of High Court judgments regarding cash refund entitlement

Analysis:
The judgment pertains to an appeal challenging an order allowing a refund in cash, where the appellant had initially filed a refund claim under exemption Notification No.50/2005-CE. The dispute arose when the refund amount was credited to the cenvat credit account instead of being refunded in cash. The appellate tribunal considered the interpretation of Section 11B of the Act in such cases. Reference was made to the M/s Max Power Infosystems case, where a similar issue was addressed. In that case, it was established that if an assessee is unable to utilize the cenvat credit account due to exemption status, a refund in cash is justified. This principle was further supported by the High Court judgments, emphasizing that the very basis of the refund is defeated if the credit cannot be utilized. Consequently, the tribunal held that the appellant was entitled to a cash refund rather than crediting the amount to the cenvat credit account.

The tribunal highlighted the settled nature of the issue based on the precedent set by the M/s Max Power Infosystems case, indicating that the Revenue's appeal lacked merit. Therefore, the tribunal dismissed the appeal and upheld the impugned order allowing the refund in cash. The judgment reaffirmed the principle that when an assessee is unable to utilize the cenvat credit account, the refund claim should be granted in cash. This decision was in line with the interpretation of relevant legal provisions and supported by previous judicial rulings, ensuring the rightful entitlement of the appellant to receive the refund amount in cash.