2023 (7) TMI 1235 - AT - Central Excise

Refund of accumulated Cenvat Credit - whether inputs procured under DEEC/ Advance License Scheme has not suffered any duty and hence, availment of refund for export under such scheme would tantamount to double benefit to the appellant? - HELD THAT - The manufacturer of excisable goods is entitled for grant of refund of accumulated Cenvat Credit availed on the inputs, subject to fulfillment of the condition that the finished goods have been exported. In the present case, since the Department has not specifically alleged that the appellant had not exported the finished goods, denial of benefit of refund on the ground that the inputs procured under the DEEC/Advance License Authorization Scheme will not be sustained, inasmuch as the statute does not debar such availment of benefit by the exporter. In an identical case, this Tribunal in the case of COMMISSIONER OF C. EX., JAIPUR-II VERSUS BHILWARA SPINNERS LTD. 2011 (2) TMI 584 - CESTAT, NEW DELHI has dealt with the situation and allowed the refund benefit in favour of the assessee. There are no merits in the impugned order, insofar as it has denied the refund benefit to the appellant. Therefore, by setting aside impugned order, the appeal is allowed in favour of the appellant with consequent benefit of refund, if any, as per law.

Summary

Issues involved: Denial of refund benefit under Rule 5 of the Cenvat Credit Rules, 2004 for export of goods procured under the Advance License Scheme.

Summary:

Issue 1: Denial of refund benefit under Rule 5 of the Cenvat Credit Rules, 2004

The appellant, engaged in manufacturing pharmaceutical products, availed Cenvat Credit and claimed refund of accumulated credit for exported goods under Rule 5. The Department denied the refund, alleging double benefit due to duty-free inputs under the Advance License Scheme. The Commissioner (Appeals) upheld the denial. The appellant appealed to the Tribunal.

Details for Issue 1:

The appellant argued that Rule 5 does not restrict refund for goods procured under the Advance License Scheme. Citing precedent, the appellant sought refund as per Rule 5. The Revenue supported the denial.

The Tribunal examined the case records for the period from January 2011 to March 2011. Rule 5 allows refund of Cenvat Credit for exported goods, without specific restrictions on inputs under the Advance License Scheme. As the Department did not dispute the exportation of goods, denial of refund based on input procurement was deemed unjustified.

Referring to a previous case, the Tribunal emphasized that Rule 5 does not exclude refund for goods exported under the Advance License Scheme. The Tribunal found no merit in the denial of refund and allowed the appeal, granting the appellant the refund as per the law.

Therefore, the Tribunal set aside the impugned order and allowed the appeal in favor of the appellant, providing the consequent benefit of refund, if applicable, in accordance with the law.

Separate Judgment:
No separate judgment was delivered by the judges in this case.