Custom, Excise & Service Tax Tribunal
M/S Mahesh Dyeing & Printing Mills (P) ... vs C.C.E. & S.R. Surat-I on 28 March, 2018
In The Customs, Excise & Service Tax Appellate Tribunal West Zonal Bench At Ahmedabad Appeal No.E/10354/2018-SM [Arising out of OIA No. CCESA-SRT-(APPEAL)/PS-186/2017-18 dated 13.11.2017 passed by Commr. (Appeals) Surat-I] M/s Mahesh Dyeing & Printing Mills (P) Ltd. Appellant Vs C.C.E. & S.R. Surat-I Respondent
Represented by:
For Appellant: Sh. N. Gheewala (Consultant) For Respondent: Sh. K.J. Kinariwala (A.R.) CORAM:
HONBLE DR. D.M. MISRA, MEMBER (JUDICIAL) Date of Hearing/decision:28.03.2018 Final Order No. A/ 10585 /2018 Per: Dr. D.M. Misra:
Heard both the sides.
2. This appeal is filed against order in appeal No. CCESA-SRT-(APPEAL)/PS-186/2017-18 passed by the Commissioner of Central Excise (Appeals) Surat. The short issue involved in the present appeal is whether the appellant are entitled to cash refund of Rs. 4,00,000/-, which was allowed by the adjudicating authority in the form of CENVAT Credit.
3. Ld. Consultant Sh. Gheewala for the appellant submits that they have filed refund claim of 15.00 Lakh which was paid during the course of investigation i.e. an amount of Rs. 11.00 lakh was paid through cash and 4.00 lakh paid by debiting their RG-23 Part-II account. Since the issue was decided in their favour, they filed the refund claim for 15.00 lakhs which was sanctioned to them. However, the Ld. Adjudicating authority allowed refund of Rs. 11.00 lakh through cash and 4.00 lakh by way of credit. It is his contention that since their factory is now no more in operation, therefore, the amount allowed as CENVAT Credit be sanctioned in cash. In support, he referred to the judgment of this Tribunal in the case of Commissioner of Central Excise and Service Tax Surat vs Mamta Silk Mills Vide Final Order No. A/17343-17344/2017 dated 16/11/2017.
4. Ld. AR for the Revenue, on the other hand, referring to the judgment of Larger Bench of this Tribunal in the case of Steel Strips vs CCE, Ludhiana 2011 (269) ELT 257 (Tri. LB), submits that CENVAT Credit in cash cannot be allowed except the circumstances laid down under the CENVAT Credit Rules, 2004. Further, he submits that the judgment of the Larger Bench of this Tribunal was not brought before the Bench which decided the Mamta Silk Mills case, therefore, would not be considered as a binding precedent.
5. I find force in the the contention of Ld. A.R. for the Revenue. The Larger Bench of Tribunal while answering a reference about admissibility of refund by way of cash, instead of credit, since it could not be utilized due to closure of the factory observed as follows:
5.16?Modvat law has codified procedure for adjustment of duty liability against Modvat Account. That is required to be carried out In accordance with law and unadjusted amount is not expressly permitted to be refunded. In absence of express provision to grant refund, that is difficult to entertain except in the case of export. There cannot be presumption that in the absence of debarment to make refund in other cases that is permissible. Refund results in outflow from treasury, which needs sanction of law and an order of refund for such purpose is sine qua non. Law has only recognized the event of export of goods for refund of Modvat credit as has been rightly pleaded by Revenue and present reference is neither the case of otherwise due of the refund nor the case of exported goods. Similarly absence of express grant in statute does not imply ipso facto entitlement to refund. So also absence of express grant is an implied bar for refund. When right to refund does not accrue under law, claim thereof is inconceivable. Therefore, present reference is to be answered negatively and in favour of Revenue since refund of unutilized credit is only permissible in case of export of goods and for no other reason whatsoever that may be. As has been stated earlier that equity, justice and good conscience are the guiding factors for Civil Courts, no fiscal Courts are governed by these concepts, the present reference is bound to be answered in favour of Revenue and it is answered accordingly.
5. Following the aforesaid precedent which has subsequently, referred and followed in Modipon Ltd. Vs CCE Ghaziabad 2015 (324) ELT 718 (Tri. Del.), I do not find merit in the appeal. Consequently, the impugned order is upheld and the appeal is dismissed.
(Dictated and pronounced in the open court) (Dr. D.M. Misra) Member (Judicial) Neha 3 | Page E/10354/2018-SM