The Mumbai Bench of Customs, Excise and Service Tax Appellate Tribunal (CESTAT), in its ruling, showcased a keen understanding of the intricacies involved in the case.
One of the pivotal arguments that tilted the decision in favor of the Maharashtra State Power Generation Company was the tribunal’s emphasis on the fallacy of demanding the original document as proof of duty discharge.
The tribunal astutely noted that such insistence was unwarranted, especially when comprehensive records were readily available with the central excise authorities. This critical insight, rooted in relevant case law, served as the linchpin for setting aside the prior decision that had initially denied the refund claim.
The Commissioner had rejected the refund claim on the grounds that the TR-6 challan, which served as evidence of duty payment, had not been furnished adequately.
The two-member bench of the tribunal, comprising C J Mathew (Member Technical) and Aajay Sharma (Member Judicial), underscored the importance of adhering to the documentation requirements stipulated under Section 11B of the Central Excise Act, 1944.
This section outlines the necessary protocols for claiming refunds, and the tribunal’s meticulous analysis found that the lower authorities had erred in their insistence on the original document. The tribunal’s order explicitly stated, “Proof of payment of duty is well reflected in the department’s records,” effectively validating the company’s position.
The counsel for M/s Maharashtra State Power Generation Company Ltd argued that the denial of their refund claim of ₹36,70,325 was unjust, emphasizing the precedent set in Maharashtra State Electricity Board v. Commissioner of Central Excise, Nagpur.
The counsel asserted that departmental correspondence and records effectively demonstrated the payment of duty, negating the need for the original TR-6 challan. They contended that it was inappropriate for the lower authorities to insist on the original document when sufficient evidence was available with the central excise authorities. The counsel sought a fresh determination of the refund application in light of the judicial recognition of the non-excisability of the claimed amount.
With this resounding judgment, the tribunal not only granted the much-contested refund but also directed the proper officer to implement the order expeditiously, setting a two-month timeframe for compliance.
The appeal’s success, framed as a remand, signifies a decisive and favorable outcome for the Maharashtra State Power Generation Company Ltd in this protracted tax refund dispute.
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