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TMI Blog2020 (10) TMI 946X X X X Extracts X X X X X X X X Extracts X X X X ..... her, Para -14 of Circular No.79/53/2018-GST dated 31.12.2018 clarified that both the law and the related rules clearly prevent the refund of tax paid on input services and capital goods as part of refund of input tax credit accumulated on account of inverted duty structure. Since the appellant has taken Input Tax Credit on the Input, namely Vanaspati and Cooking Oils, Packing material, Input Services related to job work and Capital Goods etc., which attracts different rates of GST Further - as per CGST Act and Rules clearly prohibit the refund of tax paid on input services and capital goods as part of refund of input tax credit accumulated on account of inverted duty structure. There are no force in the contention of the appellant and the reliance placed by the appellant in their defence is not applicable in this case. The adjudicating authority has rightly passed the order and appellant is not entitled for refund of unutilized input tax credit. Therefore, the appeal is rejected to that extent. Re-credit of the amount of 1,07,18,285/- in Electronic Credit Ledger of the appellant - Rule 93 of the CGST Rules. 2017 - HELD THAT:- The appellant may approach the adjudicating authority an ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed to consider that requirement of rate of tax on inputs being higher than the rate of tax output supply is the only condition subject to the satisfaction of which the refund of the entire accumulated input tax credit shall be allowed. * that the learned adjudicating authority has grossly erred in relying on the amended definition of Net ITC as amended by Notification No.21/2018- Central Tax dated 18 04 2018 and Notification No.26/2018-Central Tax dated 13.06.2018 since the definition of Net ITC prior to the said amendment allowed refund of both input goods and input services. Also. the learned adjudicating authority has failed to consider that amendment made in the definition of the Net ITC under Rule 89(5) of CGST Rules is not retrospective in nature. * that the adjudicating authority has grossly erred in relying on Circular No. 79/53/2018-GST dated 31.12.2019 as the said circular is against the language of Section 54(3) (ii) of the CGST Act and grossly erred in rejecting the refund claim on the ground that tax rate OQ major input and output supply is same, since no such condition is prescribed under the Section 54(3) (ii) of the CGST Act. * that Section 54(3) lays down the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the refund of accumulated input tax credit due to inverted tax structure, shall not be allowed. Thus goods supplied by the appellant is no where mentioned in the said Notification. The appellant has also placed reliance on the following decisions:- * * WNS Global Services (P) Ltd [2011 (22) Service Tax Rules 1994 609 (Born.)] * Satyam Balaji Rice Industries (P) Ltd [2015 (39) STR 1004 (Tri Del)] * RL Fine Chem [2014 (35) STR 814 (Tri- Bang)] * Union of India & Ors. V Tushar Ranjan Mohanty & Ors. (1994) 5 SCC 450 * P.D. Aggarwal & Ors. V State of U.P. & Ors. AIR 1987 SC 1676 * Chairman, Railway Board & Ors. V C R. Rangadhamaiah & Prs., AIR 1997 SC 3828 * Shabnam Petrofils Pvt Ltd., Vs Union of India (Special Civil Application No. 16213 of 2018) decided on 17.07 2019) * that the learned adjudicating authority has failed to appreciate that the appellant has correctly submitted the undertaking as per Section 93(2) of CGST rules and has grossly erred in rejecting of refund amount to Appellant's electronic credit ledger. Appellant further prayed in case refund filed by the appellant is rejected; ₹ 1,07,18,285/- should be re-credited in the electronic credit l ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ules, the term Net ITC cover the ITC availed on all inputs in the relevant period, irrespective of their rate of tax. Further, as per Para -14 of Circular No.79/53/2018-GST dated 31.12.2018 states as under:- Section 54(3) of the CGST Act provides that refund of any unutilized ITC may be claimed where the credit has accumulated on account of rate of tax on inputs being higher than the rate of tax on output supplies (other than nil rated or fully exempt supplies). Further, section 2(59) of the CGST Act defines inputs as any goods other than capital goods used or intended to be used by a supplier in the course or furtherance of business. Thus, inputs do not include services or capital goods. Therefore, clearly, the intent of the law is not to allow refund of tax paid on input services or capital goods as part of refund of unutilized input tax credit. Accordingly, in order to align the CGST Rules with the CGST Act, notification No. 26/2018-Central Tax dated 13.06.2018 was issued wherein it was stated that the term Net ITC, as used in the formula for calculating the maximum refund amount under rule 89(5) of the CGST Rules, shall mean input tax credit availed on inputs during the relev ..... X X X X Extracts X X X X X X X X Extracts X X X X
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