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2018 (9) TMI 632 - AT - Central Excise100% EOU - Refund of cenvat credit of Central Excise duty - export of goods - Rule 5 of the CCR 2004 - Held that - The Hon ble High Court in Commissioner of Customs and Excise Jaipur-I Vs Continental Engines Limited DB 2018 (2) TMI 1769 - RAJASTHAN HIGH COURT has held that 100% EOU is entitled to take cenvat credit on goods/inputs procured in the industry and when they were not in a position to utilise the same they are entitlement for benefit of refund under Rule 5 of CCR 2004 - refund allowed - appeal dismissed - decided against Revenue.
Issues:
Appeal against denial of refund of Central Excise duty claimed under Rule 5 of CCR 2004 for goods exported by a 100% EOU. Analysis: The appellant, a 100% EOU, sought a refund of Central Excise duty under Rule 5 of CCR 2004 for goods exported, claiming entitlement to purchase duty-free inputs under Notification No. 22/2003. The Ld. Commissioner (Appeals) ruled in favor of the appellant based on a previous decision in their favor. The Revenue contended that the appellant, being a 100% EOU, is exempt from Central Excise Duty on goods procured from DTA units but cannot avail cenvat credit on duty-paid goods from DTA. The Revenue argued that the Commissioner (Appeals) erred in allowing the refund, citing the precedence of the Central Excise Act over Circulars. In a related matter, the Hon'ble High Court upheld the Tribunal's decision to allow the refund of Central Excise duty paid on inputs procured from DTA units for a 100% EOU. The High Court held that the EOU is entitled to cenvat credit on inputs procured in the industry, even if unutilized, leading to a refund under Rule 5 of CCR 2004. The High Court emphasized the EOU's entitlement to take cenvat credit on duty-paid inputs from DTA units and to claim a refund of unutilized credit. Consequently, the High Court affirmed the Tribunal's decision and dismissed the Revenue's appeal. Given the precedent set by the Rajasthan High Court and the decision of the Hon'ble High Court, the Tribunal dismissed the Revenue's appeal, allowing the appellant to receive consequential benefits. The judgment highlights the EOU's right to claim cenvat credit on duty-paid inputs from DTA units and seek a refund under Rule 5 of CCR 2004, even if the credit remains unutilized.
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