Refund on Unutilised Cenvat Credit Calculated as Per Prescribed Format Under Cenvat Credit Rules: CESTAT allows Refund [Read Order]

In a recent case, the Mumbai bench of the Customs, Excise, and Service Tax Appellate Tribunal (CESTAT) allowed the refund on Unutilised Cenvat Credit since it was Calculated as Per the Prescribed Format Under Cenvat Credit Rules, 2004.

Vistex Asia Pacific P Ltd, the appellants have filed the refund claim for an amount of Rs.7,09,489/- for unutilized Cenvat credit accumulated in their Cenvat Account due to exports in terms of Notification No.5/2006-CE(NT) as amended by Notification No. 27/2012-CE(NT) r/w Rule 5 Cenvat Credit Rules, 2004. The Adjudicating Authority vide Order-in Original sanctioned the refund of Rs.3,75,613/- and rejected the balance amount of Rs.3,33,876/- and the same was upheld by the Commissioner (Appeals) by way of impugned order. 

It has been held by the Tribunal that the revenue is not permitted to take a contrary view on identical issues because if they are permitted to do so then the law will be in a state of confusion and will place the authorities as well as the assessees in a quandary.

The appellant was permitted to deduct the utilized credit from the total/net Cenvat credit and the balance of unutilized Cenvat credit was refunded to them. It was observed that the lower authority has totally erred in deducting the utilized Cenvat credit after getting the total refund amount as per the formula prescribed under Rule 5 of the Cenvat Credit Rules.

A single member bench of Mr Ajay Sharma, Member (Judicial) observed that the first appellate authority also seems to have decided the appeal mechanically without properly looking into the issue and also the submission of the appellant that they were not heard by the lower authority. 

While allowing the appeal, the CESTAT set aside the impugned order.

To Read the full text of the Order CLICK HERE

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