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2019 (12) TMI 1060 - AT - Central ExciseRefund of CENVAT Credit - closure of factory - period of limitation - goods cleared to the SEZ units without payment of duty - rejection of refund on the ground that the SEZ supplies were not to be treated as export of goods and that refund applications were not filed within the time limit - whether the application for refund of Cenvat credit under Rule 5 of CCR 2004 could be sanctioned after 01.04.2012 on the ground that the factory has been closed after a period of six years from the closure of such factory or otherwise? HELD THAT - When the Rule 5 of CCR 2004 was amended w.e.f. 01.04.2012 there is no saving clause indicating that with respect to credits which were accumulated prior to this date the new provisions do not apply - The General Clauses Act allows continuation of any right privilege obligation or liability acquired or accrued under any Act or enactment so repealed and also affects the previous operation of any Act or enactment so repealed. In this case refund claims were filed prior to 01.04.2012 and these claims did not include refund claim on the ground that factory has been closed. The issue was raised before this Tribunal in the first round of litigation which has been rejected by this Tribunal in M/S LATA S HYDROCARBON RESOURCES PRIVATE LTD. VERSUS CC CE ST HYDERABAD-IV 2016 (12) TMI 321 - CESTAT HYDERABAD . The order of this Tribunal has not been set aside by any higher judicial forum. In pursuance of the remand by this final order the original authority has sanctioned the refund claim. Therefore all proceedings which had begun prior to 01.04.2012 have concluded unimpeded by the unamended Rule 5 of CCR 2004 for a different amount on a different ground. A separate refund claim was filed after 01.04.2012 which is the issue in dispute. The appellant was not entitled to refund as there was no saving clause when Rule 5 of CCR 2004 was amended - Further the period of limitation of one year for filing the refund claim has also been violated as refund claim was filed more than six years after alleged closure of the factory. Appeal dismissed - decided against appellant.
Issues Involved:
1. Whether SEZ supplies should be treated as export of goods. 2. Whether the refund applications were filed within the time limit. 3. Whether the appellant is entitled to a refund of unutilized Cenvat credit due to factory closure. 4. Application of Rule 5 of CCR, 2004 before and after the amendment on 01.04.2012. 5. Whether the principles of natural justice were violated by not considering the appellant’s cross objections. Issue-Wise Detailed Analysis: 1. Whether SEZ supplies should be treated as export of goods: The first appellate authority held that SEZ supplies must be treated as export of goods. This decision was based on the interpretation of the relevant provisions and judicial precedents. The Tribunal affirmed this view, referencing the Hon’ble High Court of Madras in the case of Celebrity Designs India Pvt Ltd., which considered SEZ supplies as exports for the purpose of refund claims. 2. Whether the refund applications were filed within the time limit: The original adjudicating authority and the first appellate authority rejected the refund applications on the grounds of being time-barred. The Tribunal remanded the matter to the original authority to verify if any claims fell within the limitation period when considering the date the goods entered the SEZ as the relevant date. Upon remand, refunds were allowed to the extent they were not time-barred. 3. Whether the appellant is entitled to a refund of unutilized Cenvat credit due to factory closure: The appellant claimed a refund of unutilized Cenvat credit due to factory closure, citing the decision in UOI Vs Slovak India Trading Co. (P) Ltd. However, the Tribunal found that this decision did not assist the appellant since the facts were different. The Tribunal emphasized that new contentions regarding factory closure could not be raised at the appeal stage without prior mention in the Show Cause Notice or reply. 4. Application of Rule 5 of CCR, 2004 before and after the amendment on 01.04.2012: The Tribunal analyzed the provisions of Rule 5 of CCR, 2004, noting that prior to 01.04.2012, refunds could be claimed if the Cenvat credit could not be used for any reason. Post-amendment, the clause allowing refunds for any reason was deleted. The Tribunal upheld the first appellate authority’s decision that the appellant was not entitled to a refund under the amended provisions, as the refund application was filed after the amendment came into effect. 5. Whether the principles of natural justice were violated by not considering the appellant’s cross objections: The appellant argued that the first appellate authority violated the principles of natural justice by not considering their cross objections. However, the Tribunal did not find merit in this argument, as the main issue was the applicability of the amended Rule 5 of CCR, 2004, and the time-barred nature of the refund claim. Conclusion: The Tribunal upheld the impugned order, rejecting the appellant’s claim for a refund of unutilized Cenvat credit on the grounds of factory closure and time-barred application. The Tribunal found no infirmity in the first appellate authority’s decision, which was based on the amended provisions of Rule 5 of CCR, 2004, and the lack of a saving clause for credits accumulated prior to the amendment. The appeal was dismissed, and the order was pronounced in the open court on 23.12.2019.
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