2018 (3) TMI 758 - AT - Central Excise

Refund claim - time limitation - Section 11B of CEA - Held that - on the insistence of departmental officer appellant reversed the credit on 17-09-2014 only, thereafter refund has arisen, before that there was no occasion of filing any refund as the appellant had availed the credit which was made on 17-09-2014 - appellant s filing the refund claim within six months is well within the time line as prescribed u/s 11B - appeal allowed - decided in favor of appellant.

Summary

Issues:
1. Time bar for refund claim under Section 11B of the Act.

Analysis:
The case involved an appeal regarding the refund claim filed by the Appellant for the duty paid on clearances of Textile Machinery parts under the Status Holder’s Incentive Scheme. The Appellant had paid excise duty in November 2013, realizing their mistake later, they availed suo moto credit on duty wrongly paid in the same month. The department objected, stating that a refund claim should have been filed instead of taking suo moto credit. The adjudicating authority rejected the refund claim as time-barred under Section 11B since the claim was filed in March 2015 for duty paid in November 2013.

The Appellant argued that the refund claim was filed concerning the reversal of Cenvat credit made in September 2014, which was within the one-year time limit prescribed by Section 11B. The Appellant contended that until the reversal of credit in September 2014, no refund situation existed as they had availed the credit. Therefore, the Appellant requested the refund to be allowed.

After considering the submissions, the Member (Judicial) noted that the Appellant corrected their mistake by re-crediting the Cenvat account in the same month of payment. The Member found the Appellant's actions to be correct as adjustments within the same month before filing returns are permissible. The Member observed that the refund claim arose only after the credit reversal in September 2014, and until then, there was no basis for a refund claim. Consequently, the Member held that the refund claim filed within six months was within the prescribed time limit under Section 11B. Therefore, the Member set aside the impugned order and allowed the appeal, ruling that the refund was not to be denied on the grounds of being time-barred in the specific circumstances of the case.