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2018 (1) TMI 912

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..... in such cases the procedure and limitation for claiming such refund would be governed by the provisions of Section 11B of the Central Excise Act - provisions of section 11B of the Central Excise Act are applicable to the facts of this case. The appellant is entitled to claim interest from the date of filing of refund of set off by way of credit to the Modvat scheme after three years from the date of filing claim of refund of set off by way of transfer to Modvat Credit Scheme under RG-23A till its realisation. Appeal allowed - decided in favor of appellant. - E/3187/2012 (DB) - Final Order No.70175/2018 - Dated:- 15-1-2018 - Shri Ashok Jindal, Member (Judicial) And Shri Anil G. Shakkarwar, Member(Technical) Shri Vishal Agarwal .....

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..... .06.2006, 21.02.2011 and 02.08.2011, which were pursuant to the disputes relating to credit availed under the set off regime being decided by either this Tribunal or the ld.Commissioner(Appeals). Although transfer was allowed, but payment of interest was not given for delay in permission to transfer the credit. The appellant requested for sanction of the interest on the said unutilized credit balance for the period of delay in grant of refund by way of transfer of credit. A show cause notice was issued to the appellant for rejection of their claim of interest and claim of interest was rejected on the ground that the transfer of credit under Rule 57H(3) was not an application for refund filed under section 11B of the Central Excise Act and t .....

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..... urer who had been immediately before filing of declaration under Rule 57G availing of,- (a) the special procedure under Rule 56A in respect of materials or component parts for use in the manufacture of finished excisable goods, or (b) an exemption for giving credit with respect to duty paid on the materials or component parts used in the manufacture of finished excisable goods, the Collector may permit such manufacturer to transfer the credit of duty paid on the said materials or component parts received by such manufacturer and lying unutilized immediately before obtaining the dated acknowledgement of declaration made under Rule 57G in his account in RG 23 to his account in RG 23A. Provided that the materials and comp .....

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..... esaid provision. This benefit is being resisted by the respondents on the ground that in a claim for Modvat credit made under Rule 57H the provisions of Section 11B and Section 11BB of the Central Excise Act will not apply. This question is considered by the Gujarat High Court in the case of Indo-Nippon (supra). That was a case where the assessee had made a contention that provisions of Section 11B and Section 11BB are not attracted to Modvat credit whereas it was the case of the department that the said provisions are applicable even to Modvat credit. After considering the provisions of sub-section (2) of Section 11B in Paras 28 and 29 of the aforesaid judgment a Division Bench of the Gujarat High Court has held that the language of clau .....

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..... 8. As the Hon ble High Court has held that the provisions of rule 57H and the Notification issued thereunder enable refund under Modvat credit scheme, but even in such cases the transfer of limitation for claiming such refund would be covered by the provisions of section 11B of the Act, therefore we hold that provisions of section 11B of the Central Excise Act are applicable to the facts of this case. Further we find that in the case of Hindustan Coca-Cola Beverages Pvt.Ltd. (supra ), Hon ble Gujarat High Court further observed as under:- 1.1 There was delay in allowing the transfer of respective Modvat/Cenvat credit from the date of application till the date for grant of such Modvat/Cenvat credit. 1.2 The petitioner was .....

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..... s within time limit, the amount to which the petitioner was rightfully entitled was denied to him. The only inescapable conclusion that we can reach is that the respondents had no reason to deny the transfer of the unutilized credit to the petitioner on merger. They had no authority to withhold such amount in law. In that view of the matter, it would be highly unjust to permit the respondents to hold on to the petitioner s money for nearly 5 years without any interest at all as it would amount to Revenue taking advantage of its own wrong of withholding the permission for transfer of credit. 5.4 The contention to the effect that no interest is payable because there is no provision of interest under the scheme of the Act is also thorou .....

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