Customs, Excise and Services Tax Appellate Tribunal (CESTAT): Ashok Jindal (Judicial Member) allowed an appeal filed against the impugned order wherein the refund claim had been rejected in terms of the provisions effective from 01-03-2015 in case of deemed export.
The counsel for the appellant, Mr Naveen Bindal submitted that he was not contesting the matter and was taking the alternative plea that while filing the refund claim, they had reversed certain cenvat credit and as their claim of refund was pending before the adjudicating authority, an amendment took place and Central Goods and Service Tax Act (CGST Act) 2017 was introduced in place of Central Excise Act, 1944. The adjudication order was passed after the introduction of CGST Act 2017 therefore, the appellant was having no occasion to raise the issue of re-credit of cenvat credit which have reserved before the adjudicating authority; therefore, in terms of Section 142(3) of the CGST Act 2017, they were entitled to cash refund or re-credit to their cenvat credit account.
The Tribunal observed that It is a fact on record that when the appellant filed the refund claim of cenvat credit reversed by them, it was not the issue but with the introduction of CGST Act 2017, the issue of re-credit arose in terms of Section 142 (3) of the CGST Act 2017 and the appellant had no occasion to raise the issue of the re-credit before the adjudicating authority as the adjudicating authority itself had passed the impugned order after introduction of CGST Act 2017. The Tribunal relied on the judgment of Rawalwasia Ispat Udyog (P) Ltd. v. CCE, 2019 (26) GSTL 196 where it was observed that,
“4. Considering the fact that as per Section 142 (3) of CGST Act, 2017, which was enforced with effect from 1.7.2017 if any refund arises on account of Cenvat credit, duty, tax, interest or any amount, the same shall be paid in cash to the assessee. Despite, clear-cut provisions of law in GST regime, the Commissioner (Appeals) has allowed the refund to be credited in their Cenvat Credit account which is against the spirit of law. In fact, the Commissioner (Appeals) by doing this act has dragged the appellant in unnecessary litigation before this Tribunal, the act of the Commissioner (Appeals) cannot be appreciated. Therefore, I do not find any merit in the impugned order, the same is set aside and the order of the adjudicating authority is restored.”
The Tribunal allowing the appeal held that the appellant was entitled to re-credit of the amount already reversed before the introduction of CGST Act 2017.[Great India Steel Fabricators v. CCE & ST, Excise Appeal Nos. 60833 & 60836 of 2018, decided on 10-12-2020]
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