2018 (4) TMI 1112 - AT - Customs

Refund of CVD with applicable Education Cess - Original authority had rejected the refund claim on the ground that the appellant has availed CENVAT credit of the refund of the CVD which is sought to be refunded by the appellant - Held that - appellants had issued a letter to the jurisdictional authority requesting to clarify the fact of initial availment of credit by the appellant and the reversal of the fact. There was no response from the jurisdictional authority - If the appellant has availed credit definitely they are not eligible to refund of the same. The fact whether the appellant has reversed the credit requires to be verified - appeal allowed by way of remand.

Summary

Issues:
Refund application rejection based on availing CENVAT credit of CVD, appellant's claim of reversing credit before utilization, lack of response from jurisdictional authority clarifying non-availment of credit, need for verification of credit reversal.

Analysis:
The case involved a refund application for an amount related to CVD with applicable education cess on imported goods. The appellants initially claimed they had not availed CENVAT credit on the CVD, but it was discovered they had availed such credit. The original authority and Commissioner (Appeals) rejected the refund application due to this reason. The appellant argued that they had reversed the credit before utilization, making them eligible for the refund. They cited relevant case laws to support their argument.

The appellant contended that they had reversed the credit and informed the department about it before the Order-in-Original was passed. They also sent a letter to the jurisdictional authority seeking clarification on the credit availed. However, the Commissioner (Appeals) upheld the rejection of the refund claim citing lack of response from the jurisdictional authority. The appellant emphasized the need for verification of credit reversal and argued that the authorities should have considered this aspect before rejecting the refund claim.

On the other hand, the respondent reiterated the findings of the impugned order, stating that the appellant had initially declared not availing credit but later claimed to have reversed it without providing substantial evidence. The respondent argued that no records were produced to support the claim of credit reversal, and no clarification was received from the jurisdictional authority. The respondent supported the rejection of the refund claim by the authorities.

After hearing both sides, the Tribunal noted that the appellant had filed a refund claim for the CVD amount, which was rejected based on the availing of CENVAT credit. The Tribunal acknowledged the appellant's claim of reversing the credit but emphasized the need for verification. As no conclusive evidence of credit reversal was presented, the Tribunal decided to remand the matter to the refund sanctioning authority for verification. The impugned order was set aside, and the appeal was allowed for reconsideration by the adjudicating authority regarding the credit reversal issue.