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TMI Blog2024 (5) TMI 124X X X X Extracts X X X X X X X X Extracts X X X X ..... d not be utilized and by restricting the same to the extent of ratio of export turnover to the total turnover as per the prescribed formula, the eligible Cenvat credit for refund is arrived at Rs.77,754/-. Thus, the total eligible amount of Cenvat credit refundable to the appellants is worked out as Rs.4,22,558/-, out of the total refund claim filed for an amount of Rs.13,37,072/-. There are no merits in the impugned order dated 21.08.2018, insofar as the adjudged demands were confirmed on the appellant by the learned Commissioner (Appeals), upholding the order of the original authority and by rejecting the appeal filed by the appellant. The adjudged demands confirmed on the appellants being ineligible refund of Cenvat credit and rejection of eligible refunds, in the impugned order dated 21.08.2018 is liable to be set aside. The eligible refund of Cenvat Credit in terms of Rule 5 of CENVAT Credit Rules, 2004 read with Notification No. 5/2006-C.E. (N.T) dated 14.03.2006 is re-determined as Rs.4,22,558/- - the impugned order is set aside - appeal allowed. - MR. M.M. PARTHIBAN, MEMBER (TECHNICAL) Shri Sunil Agarwal, Advocate for the Appellant Shri Amrendra Kumar Jha, Authorized Repr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he Cenvat credit could not be utilized for payment of duty; but he has not given any findings for other conditions of Rule 5 ibid i.e., about the export of goods and credit taken for duty paid on the inputs used in the export goods and further that the said Rule 5 ibid provides for no refund of credit if the manufacturer avails of drawback or claims rebate of excise duty/service tax. Learned Commissioner of Customs (Appeals) in his Order-in-Appeal dated 21.02.2011 had allowed the review application filed by the department, by rejecting the refund claim of the appellant. Being aggrieved with the said order of the Commissioner (Appeals), the appellant had initially filed an appeal before this Tribunal. 2.2 In the first round of litigation, the Tribunal had passed the Order No. A/86938/16/SMB dated 01.03.2016 wherein the Tribunal had remanded the matter back to the original authority for fresh adjudication of the case. The relevant paragraph of the said order of the Tribunal is extracted and given below, as under: I have carefully considered the submissions made by both the sides and perused the records. I find that the adjudicating authority in the original order quantified the refun ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... while passing the above order in de novo adjudication, the Original adjudicating authority had also observed as follows: 8. I find that the assessee while filing the refund claim dated 29.12.2009 had made a mis-declaration that no separate claim for rebate of duties or service tax in respect of excisable materials used in the manufacture of the goods or output service covered by this application has been under the Customs and the Central Excise Duties Drawback Rules, 1971. The assessee had exported goods under UT-1 and claimed drawback thereon but suppressed the same while filing the refund claim which was detected during scrutiny of the documents submitted. Thus, the assessee has not only furnished wrong declaration but also kept the Department in dark about the details of inputs utilized and credit involved therein for manufacture of goods exported after excluding the goods exported under Rebate claim or Drawback claim. 9. The assessee has not submitted any proper reasoning with documentary evidence in respect of the conditions laid down under Rule 5 of the CENVAT Credit Rules, 2004 read with Notification no. 05/2006-C.E. (N.T.) dated 14.03.2006. Despite being aware of the Centra ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... bmitted that they had claimed refund of Rs.13,37,072/-. However, none of the lower authorities have examined the factual details alongwith documents to work out the actual credit of inputs involved in export of goods, which is refundable to them under Rule 5 of CENAT Credit Rules, 2004. He further submitted that all relevant documents for the claim of refund were submitted initially to the Department and if some of the documents were lost in handling at the department, then the appellant should not be punished in denying refund on the ground that documents are not available with the department. Learned Advocate also highlighted that out of the total clearances of Rs.5,64,08,820/-, a small portion of goods worthRs.9,19,120/- were alone cleared for domestic consumption and rest of the major portion of the goods were exported by the appellant. Hence, they are eligible for refund in terms of the calculation prescribed under Notification No. 5/2006-CE(N.T) dated 14.03.2006. In support of the claim, they submitted a copy of the refund application submitted to the original authority on 29.12.2009 alongwith the details of the export in various annexures alongwith few copies of tax invoices ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... + export services whose provision has been completed for which payment had been received in advance in any period prior to the relevant period advances received for export services for which the provision of service has not been completed during the relevant period; ( E ) Total turnover means sum total of the value of (a) all excisable goods cleared during the relevant period including exempted goods, dutiable goods and excisable goods exported; (b) export turnover of services determined in terms of clause ( D ) of sub-rule (1) above and the value of all other services, during the relevant period; and (c) all inputs removed as such under sub-rule (5) of rule 3 against an invoice, during the period for which the claim is filed. (2) This rule shall apply to exports made on or after the 1st April, 2012: Provided that the refund may be claimed under this rule, as existing, prior to the commencement of the CENVAT Credit (Third Amendment) Rules, 2012, within a period of one year from such commencement: Provided further that no refund of credit shall be allowed if the manufacturer or provider of output service avails of drawback allowed under the Customs and Central Excise Duties and Ser ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed to this notification to the Deputy Commissioner of Central Excise or the Assistant Commissioner of Central Excise, as the case may be, in whose jurisdiction, - (a) the factory from which the final products are exported is situated, along with the Shipping Bill or Bill of Export, duly certified by the officer of customs to the effect that goods have in fact been exported; or (b) the registered premises of the service provider from which output services are exported is situated, along with a copy of the invoice and a certificate from the bank certifying realization of export proceeds. 4. The refund is allowed only in those circumstances where a manufacturer or provider of output service is not in a position to utilize the input credit or input service credit allowed under rule 3 of the said rules against goods exported during the quarter or month to which the claim relates (hereinafter referred to as the given period ). 5. The refund of unutilised input service credit will be restricted to the extent of the ratio of export turnover to the total turnover for the given period to which the claim relates i.e. Maximum refund Total CENVAT credit taken on input services during the given ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... home consumption or for export on payment of duty or for payment of service tax on output services during the given period. I/We request that refund of such credit for the given period may be granted. The following particulars/enclosures are being provided/enclosed by me/us for this purpose. ( A) PARTICULARS OF FINAL PRODUCTS OR OUTPUT SERVICES EXPORTED DURING THE GIVEN PERIOD :- (i) Description :- (a) Final Products __________ (b) Output Services _________ (ii) Quantity (in units) in case of final products _________ (iii) Value :- (a) Final products___________________________ (b) Output Services__________________________ (B) PARTICULARS OF INPUTS OR INPUT SERVICES USED IN THE MANUFACTURE OF FINAL PRODUCTS OR USED IN PROVIDING OUTPUT SERVICES DURING THE GIVEN PERIOD :- (i) Description :- (a) Inputs __________ (b) Input Services ________ (ii) Quantity (in units) in case of inputs _________ (iii) Amount of credit taken on :- (a) Inputs__________________ (b) Input Services_______________ (C) TOTAL TURNOVER DURING THE GIVEN PERIOD :- (i) The value of all output services and exempted services provided, including value of services exported. (ii) The value of all excisable and non excisa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nd necessary action. 2. The Commissioner of Central Excise __________________ Date_____________ Deputy/Assistant Commissioner of Central Excise___________ ________________________________________________________________________ Passed for payment of Rs. _________________(Rs. ____________). The amount is adjustable under Head 0038-Union Excise Duties-Deduct Refunds/ 0044-Service tax-Deduct Refunds . Date___________ Chief Accounts Officer ________________________________________________________________________ Cheque No. ___________ dated _____________ issued in favour of Shri/Messrs ___________________ for Rs. _________ (Rs. ____________). Date ___________ Chief Accounts Officer ________________________________________________________________________ Received Cheque No. ________________ dated ________________ for Rs. _____________________ (Rs.______________). Dated_________________ Signature of claimant. 7. On careful examination of the Rule 5of the CENVAT Credit Rules, 2004 read with Notification No. 5/2006-C.E. (N.T) dated 14.03.2006, issued in exercise the said Rule 5, it transpires that the following are the legal position in allowing refund of Cenvat credit of inputs or inputs ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... other scheme of drawback or rebate. Therefore, that part of the consignment which has been cleared under rebate, drawback will not be eligible for refund and only that part of consignment which have been cleared under Bond/LUT are eligible for claim of refund, irrespective of the fact that other consignments were cleared under rebate or drawback. Thus, the condition 7(i) has been fulfilled inasmuch as the goods in respect of which the refund of Cenvat credit has been claimed have been exported out of the country. 8.2 In respect of condition at 7(ii), I also find that the formula prescribed in the Rule/Notification ensure that the refund is restricted to the extent of export that had taken place without payment of duty under Bond/LUT. The said formula has been applied in the present case and the refund is restricted to the extent of export that had actually taken place, and thus this condition has also been fulfilled in the present case. 8.3 As regards 7(iii) in respect of the conditions, procedure to be followed, in the present case it is very clearly recorded in paragraph 8 of the Order-in- Original dated 19.03.2010 that a refund application has been filed by the appellant along w ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... o the said Notfn No. 5/2006-C.E. (NT) dated 14.03.2006, as amended, the refund is admissible only if the average export clearances of final products or the output services in value terms is fifty percent or more of the total clearances of final products or output services, as the case may be, in the preceding quarter. In the present case, the value of export clearances of final products in respect of which the refund is claimed i.e. Export under UT- 1 during the preceding quarter i.e. October, 2008 to December, 2008 is Rs. 2,95,19,636/- as against the total value of clearances of Rs. 5,71,52,873/- during the preceding quarter i.e. October, 2008 to December, 2008. In percentage terms, the value of clearances for Export under UT-1 during the relevant period works out to 51.65% on the total value of clearances which satisfies the 50% limit prescribed by the statute as above and therefore, the refund claim is admissible on this count. 9. Further, I find that the assessee has availed the input services credit amounting to Rs. 1,49,503/- during the period January, 2009 to March, 2009. As per condition No.5 of the Appendix to the said Notfn. No. 5/2006- C.E. (NT) dated 14.03.2006, as amen ..... X X X X Extracts X X X X X X X X Extracts X X X X
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