Custom, Excise & Service Tax Tribunal
Yes vs Represented By : None on 19 September, 2014
CUSTOMS EXCISE & SERVICE TAX APPELLATE TRIBUNAL, West Zonal Bench, Ahmedabad COURT Appeal No. : E/82/2008 Arising out of : OIA No Commr(A)/215.VDR-I/2007 Dated 29/10/2007 Passed by : The Commissioner (A), CE&ST, Vadodara I For approval and signature : Mr. H.K. Thakur, Hon.ble Member (Technical) 1 Whether Press Reporter may be allowed to see the Order for publication as per Rule 27 of the CESTAT (Procedure) Rules, 1982? No 2 Whether it should be released under Rule 27 of CESTAT (Procedure) Rules, 1982 for publication in any authoritative report or not? Yes 3 Whether their Lordships wish to see the fair copy of the Order? Seen 4 Whether Order is to be circulated to the Departmental authorities? Yes Appellant (s) : M/s Mahindra & Mahindra Ltd Represented by : None Respondent (s) : The Commissioner, CE&ST, Vadodara I
Represented by : Shri J Nair (AR) CORAM :
Mr. H.K. Thakur, Hon.ble Member (Technical) Date of Hearing / Decision : 19/9/2014 ORDER No. A/11865 / 2014 dtd 19/9/2014 Per : Mr. H K Thakur;
This appeal has been filed by the appellant with respect to OIA No Commr(A)/215.VDR-I/2007 dt 29/10/2007- dt 13/11/2007. The issue involved in the present proceedings is whether appellant is entitled to Cenvat Credit lying unutilised in the cenvat credit account, when the finished goods got exempted as per Budget 2004-05 as per Notification No of 3/2004-CE dt 8/7/2004.
2. When the case was called out for hearing on 19/9/2014 none appeared on behalf of the appellant. On an earlier occasion also none appeared on 7/8/2014 when the case was listed for final hearing.
3. Shri J Nair (AR) appearing on behalf of the Revenue argued that there is no provision under Cenvat Credit Rule 2004 for refunding the unutilized credit lying in the Cenvat Credit account. He relied upon the Larger Bench judgement in the case of Steel Strips vs CCE Ludiana [2012(26)STR 270 (Tri.LB)]
4. Heard Learned AR and peruse the case records. Appellant did not appear for hearing on 7/8/2014 and 19/9/2014 when the appeal was listed for final hearing. There was no request for adjournment on both these occasions. The conduct and attitude of the appellant suggest that they are not interested in pursuing their appeal.
4.1 On merits I find that the issue involved in this appeal is settled by the Larger Bench judgement of CESTAT in the case of Steel Strips vs CCE Ludiana (Supra). In Para 5.11, 5.13, 5.15 and 5.16 of this judgment Larger Bench held as follows :
5.11?No person has a vested right in any course of procedure. He has only the right of prosecution or defence in the manner laid down by law. He has no right than to proceed according to the mandate of the statute governing the subject. Claim of refund is not a matter of right unless vested by law. That would depend upon the object of the statute and eligibility. The purpose for which law has been made and its nature, the intention of the legislature in making the provision, the relation of the particular provision to other provisions dealing with the subject including the language of the provision are considerable factors in arriving at the conclusion whether a particular claim is in accordance with law. No injustice or hardship can be raised as plea to claim refund in absence of statutory mandate in that behalf and no equity or good conscience influence fiscal courts without the same being embedded to the statutory provisions.
5.13?While arriving at the aforesaid conclusion, the Larger Bench in Para 11 of the order recorded the fact that in the case before them debit entry in credit account was made by the Appellants on 23-11-2000 while central excise registration was surrendered by the assessee in September 2000 i.e., before making the debit entry in RG-23 account. Further observation of the Bench was even if the amounts towards duty would not have been debited by them in the said account, the same would have been remained unutilized. As such, on the success of their appeal before the Commissioner (Appeals), they cannot claim the refund of the same in cash, inasmuch as on account of such debit entry, they have not discharged any duty out of PLA. If the said refund is granted to the appellants by way of cash, the same would amount to enrich him unjustifiably. It is well settled principles of law that what cannot be done directly should not be allowed to be done indirectly. On surrendering of their licence, the appellants were not allowed to claim the refund of the unutilized credit in the Modvat account, and the same would have lapsed. As such, utilization of the same towards payment of disputed demand of duty, after surrendering of their registration, has not led to a situation where the assessee was compelled not to use the credit for regular clearances and had to make payment from PLA. As such, in this case we find that the refund in cash is not to be allowed.
5.15?The decision made in Gauri Plasticulture (P) Ltd. was called for on the question before the Larger Bench as framed in Para 1 thereof. At the cost of repetition it may be stated that the question before Larger Bench in that case was whether duty debited in RG-23 A Part II can be refunded in cash, when the refund becomes otherwise due [Emphasis supplied]. But the conclusion in that case as per Para 10 was that if denial of credit has compelled an assessee to pay duty out of PLA, the refund of the same would be admissible in cash to the extent of payment of duty in cash during that period. However, if no cash payments towards duty were made through PLA and the credit would have remained unutilized in the account books, such credit cannot be allowed by way of cash. Such decision does not appear to have flown from the question appearing in Para 1 of the Larger Bench decision as stated aforesaid. Therefore such a decision has no attributes of a precedence not laying down the law for which present reference was warranted. It may further be stated that in Gouri Plasticultures case the question had presupposed that refund was otherwise due. But how such due arose, that does not come out from any of the paragraphs of the order reported in 2006 (202) E.L.T. 199 (Tri.-LB.). The present reference is not on the premise of refund otherwise due for which that has rightly been made for answer by Larger Bench.
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. In view of the above settled proposition of law appeal filed by the appellant is also required to be rejected on merits.
6. Appeal filed by the appellant is rejected on merits as well as for non-prosecution.
(Dictated and pronounced in the Court) (H.K. Thakur) Member (Technical) swami ??
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