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TMI Blog2010 (10) TMI 190X X X X Extracts X X X X X X X X Extracts X X X X ..... 04. Thus, the instructions issued by the Central Government under the aforesaid Circular would also be applicable to refunds under rule 5 of the Rules, which instructions are binding on the revenue. - 316 of 2009, 2117,2121,2122,2118,2120,2119/2010 - - - Dated:- 7-10-2010 - D.A. Mehta and H.N. Devani, JJ. REPRESENTED BY : Ms. Amee Yajnik, for the Appellant. Shri R.S. Sanjanwala, for the Respondent. [Judgment per : H.N. Devani, J. (Oral)]. - In each of these appeals under Section 35-G of the Central Excise Act, 1944 (the Act), the appellant-revenue has challenged common order dated 15th July, 2008 made by the Customs Excise and Service Tax Appellate Tribunal (the Tribunal) proposing following question : "Whether in the facts and circumstances of the case, the Tribunal is justified in allowing interest on delayed refund of Cenvat Credit though the provisions of section 11BB for interest are not applicable to the claimant's case"? 2. The respondent is engaged in the manufacture of Polyester Texturised Yarn and was availing cenvat credit of the duty paid on inputs used in the manufacture of Polyester Texturised Yarn. During the period April 2003 to Septemb ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... it on account of exports and where the assessee was not able to utilize the same for clearance of goods on payment of duty for home consumption. The credit was all along lying with the respondent who was always free to utilize the same. Therefore, there cannot be any provision under the statute for payment of interest on the amount which was never deposited with the exchequer. 4. It was further submitted by the learned counsel that the provisions contained in Section 11B and 11BB of the Act are general in nature, whereas the Scheme of Cenvat is specific being a special beneficial scheme, with self contained procedure providing for the manner and method of its implementation, hence, any refund claimed under the Rules would be governed only by the provisions of the Scheme and the general provisions of Section 11BB of the Act cannot be resorted to in relation to refund under the Rules. Hence, the Tribunal was not justified in holding that the assessee was entitled to interest under the provisions of Section 11-BB of the Act and as such the appeal does give rise to substantial questions of law and deserves to be admitted. 5. As can be seen from the impugned order of the Tribunal, t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eceipt of any such application, the Assistant Commissioner of Central Excise or Deputy Commissioner of Central Excise is satisfied that the whole or any part of the duty of excise and interest, if any, paid on such duty paid by the applicant is refundable, he may make an order accordingly and the amount so determined shall be credited to the Fund : Provided that the amount of duty of excise and interest, if any, paid on such duty as determined by the Assistant Commissioner of Central Excise or Deputy Commissioner of Central Excise under the foregoing provisions of this sub-section shall, instead of being credited to the Fund, be paid to the applicant, if such amount is relatable to - (a) rebate of duty of excise on excisable goods exported out of India or on excisable materials used in the manufacture of goods which are exported out of India; (b) unspent advance deposits lying in balance in the applicant's account current maintained with the Commissioner of Central Excise; (c) refund of credit of duty paid on excisable goods used as inputs in accordance with the rules made, or any notification issued, under this Act; (d) the duty of excise and interest, if ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rebate of service tax under the Export of Service Rules, 2005 in respect of such tax. Provided further that no credit of the additional duty leviable under sub-section (5) of Section 3 of the Customs Tariff Act shall be utilised for payment of service tax on any output Service. Explanation : For the purposes of this rule, the words 'output service which is exported' means the output service exported in accordance with the Export of Services Rules, 2005." 7. Thus, under the provisions of Rule 5 of the Rules if any input or input service is used in the manufacture of final product which is cleared for export under bond or letter of undertaking, and if for any reason it is not possible to adjust the same as provided under the rule, the manufacturer or provider of service is entitled to refund of such amount subject to such safeguards, conditions and limitations, as may be specified, by the Central Government, by notification. In exercise of powers under Rule 5 of the CENVAT Credit Rules, 2002 the Central Government has issued Notification : 11/2002-C.E. (N.T.), dated 1st March, 2002 providing for the procedure for refund of Cenvat credit under rule 5 of the Cenvat Credit Rules a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... made under sub-section (2) of Section 11B of the Act. 10. Section 11-BB of the Act makes provision for payment of interest from the date immediately after expiry of three months from the date of receipt of the application under sub-section (1) of that section, till the date of refund of such duty at such rate as may be fixed by the Central Government by notification in the Official Gazette subject to the minimum and maximum limits specified thereunder, if any duty ordered to be refunded under sub-section (2) of Section 11-B to any applicant is not refunded within three months from the date of receipt of such application. Thus, section 11BB of the Act would be attracted in case where there is delay in refunding the amount of duty ordered to be refunded under sub-section (2) of section 11B of the Act. Refund under Rule 5 of the Rules also being a refund under sub-section (2) of Section 11B of the Act would therefore, squarely fall within the ambit of Section 11BB of the Act and interest would be payable under Section 11BB of the Act in case of delay in sanctioning refund under Rule 5 of the Rules. 11. There is a basic fallacy in the premise on which the contention of Revenue is b ..... X X X X Extracts X X X X X X X X Extracts X X X X
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