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TMI Blog2020 (6) TMI 356X X X X Extracts X X X X X X X X Extracts X X X X ..... I I [ 2019 (6) TMI 820 - BOMBAY HIGH COURT] which also examined whether unutilised cenvat credit can be refunded on account of the closure of manufacture activities of the factory. The Hon ble Larger Bench has found that the law has not been laid down by the Hon ble Apex Court and the SLP was merely dismissed on account of the concession made by the ASG. Further, the Larger Bench of Hon ble High Court of Bombay has held that no refund can be sanctioned under Section 11B if the assessee is unable to utilise cenvat credit on account of closure of the manufacturing activities. The ratio of the judgment of the Larger Bench of the Hon ble High Court of Bombay is binding and prevails and accordingly no refund of MODVAT/Cenvat credit can be sancti ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed duty paid raw materials. The appellant paid the dues as per the order issued by the Hon'ble Settlement Commission. However, their unit was closed by this time. They, therefore, filed a refund claim for ₹ 1,81,23,725/- in cash on the ground that their unit was closed and they were not able to utilise the MODVAT credit which they were entitled to take. The original authority examined the application and found that the Hon'ble Settlement Commission has only ordered MODVAT credit to be given and not cash refund. Further, in terms of the Rule 5 of Cenvat Credit Rules, 2004 (which were in vogue at the time this decision was taken), refund of credit can only be allowed in case input or input services is used in export of goods or services ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... pon by the Tribunal have not been appealed against. In view of the concessions made by the Learned ASG, this Special Leave Petition is dismissed". Learned DR would submit that prima facie, it appears that the Hon'ble Apex Court has not laid down the law as far as the judgment of the Hon'ble High Court of Karnataka in the case of Slovak India is concerned but the case was dismissed in view of the concession made by the Learned ASG. 7. He would submit that the question which arises in such a case is whether the judgment of the Hon'ble Apex Court in the aforesaid SLP will be a declaration of law under article 141 of the Constitution of India which binds all the courts in the country or otherwise. This issue was examined at length by the Larg ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 5 (330) ELT 303 Tri-Mum] in which it has been held that refund under Rule 5 of Cenvat Credit Rules, 2004 is subject to conditions laid down in Notification No. 5/2006-CE(NT) and no refund can be sanctioned beyond this. 9. We have considered the arguments on both sides and perused the records. Rule 5 of Cenvat Credit Rules, 2004 reads as follows: "RULE 5. Refund of CENVAT Credit.- Where any input or input service is used in the final products which is cleared for export under bond or letter of undertaking, as the case may be, or used in the intermediate products cleared for export, or used in providing output service which is exported, the CENVAT credit in respect of the input or input service so used shall be allowed to be utilized by th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he Central Excise Rules, 2002, on the ground that the said inputs are used in the manufacture of goods cleared without payment of duty under the provisions of that rule." 10. This is the only provision under which a refund of Cenvat credit can be allowed. Such refund is also subject to conditions notified by the Government. There is no provision in the Cenvat Credit Rules for refund of cenvat credit if the assessee is not able to utilise it for any other purpose, such as the factory being closed. The Hon'ble High Court of Karnataka in the case of Slovak India (supra), has however allowed such refund. The SLP filed by the Revenue against this judgment has been dismissed by the Hon'ble Apex Court in view of the concessions made by the ASG. T ..... X X X X Extracts X X X X X X X X Extracts X X X X
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