2019 (5) TMI 1291 - AT - Service Tax

Refund of unutilized CENVAT Credit - Rule 5 of the CCR, 2004 read with Notification No. 27/2012-CE (NT) dated 18.06.2012 - rejection on the ground that the appellant has not complied with Clause 2(h) of the Notification - HELD THAT - The only issue on which the refund claims have been rejected is that the appellant has not complied with condition 2(h) of Notification No. 27/2012-CE (NT) dated 18.06.2012. The said condition does not require the assessee to reflect the amount debited in their ST-3 returns. It is sufficient if the assessee/appellant debits the amount claimed as refund in their accounts. There is no dispute that the appellant has not debited the amount in their account. The rejection of refund claim on the allegation that the appellant has not complied with condition 2(h) of the Notification is unjustified - appeal allowed - decided in favor of appellant.

Summary

Issues:
Refund claim under Rule 5 of the CENVAT Credit Rules, 2004 read with Notification No. 27/2012-CE (NT) dated 18.06.2012 rejected for non-compliance with condition 2(h) of the Notification.

Detailed Analysis:

1. Refund Claim Rejection:
The appellants, engaged in the export of services, filed a refund claim under Rule 5 of the CENVAT Credit Rules, 2004 for unutilized credit, as per Notification No. 27/2012-CE (NT) dated 18.06.2012. The Department rejected the claims, alleging non-compliance with Clause 2(h) of the Notification. The Commissioner (Appeals) upheld the rejection, leading to the current appeal.

2. Appellant's Argument:
The appellant's representative argued that they had debited the amount in their accounts before filing the refund claim for specific periods. However, the claims were rejected citing non-inclusion of this debit in their ST-3 returns. The appellant contended that the Notification did not mandate reflecting the debit in the ST-3 returns, emphasizing that only debiting the amount in their accounts was required. Reference was made to a previous decision to support this stance.

3. Respondent's Position:
The Authorized Representative for the respondent supported the findings of the impugned order, maintaining the stance that the appellant had not met the conditions specified in the Notification.

4. Judgment:
The Tribunal noted that the sole reason for rejecting the refund claims was the alleged non-compliance with condition 2(h) of the Notification. It was clarified that the condition did not necessitate reflecting the debited amount in the ST-3 returns; rather, it only required the appellant to debit the claimed amount in their accounts. Since the appellant had indeed debited the amount in their accounts, the rejection of the refund claim was deemed unjustified. Consequently, the impugned order was set aside, and the appeals were allowed with any consequential reliefs as per the law.

This detailed analysis highlights the core issues surrounding the rejection of the refund claim and the subsequent legal arguments leading to the Tribunal's decision in favor of the appellant based on the interpretation of the relevant Notification conditions.