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2024 (1) TMI 333 - CESTAT ALLAHABADRefund of accumulated Cenvat credit - input services or not - scope of Rule 5 of CENVAT Credit Rules, 2004 - time limitation - proceedings in terms of Rule 14 of CENVAT Credit Rules, 2004 read with Section 73 of the Finance Act, 1994 not initiated - HELD THAT:- It is observed that impugned orders have gone beyond the scope of Rule 5 of CENVAT Credit Rules, 2004, which provide for the refund of the accumulated credit in respect of export of the goods and services. This rule do not provide for denial of any credit while examining the refund claim filed under this Rule. If any credit was to be denied it could have been done in an appropriate proceedings that were to be initiated under Rule 14 of the CENVAT Credit Rules, 2004 - there are no proceedings initiated against the appellant in terms of the denial of the credit held as in admissible under the said Rule 14. Tribunal/ Courts have constantly held that denial of refund claim mad in terms of Rule 5 without initiating any proceedings under Rule 14 is no tenable. Suffice to say that without initiating the proceedings in terms of Rule 14 of CENVAT Credit Rules, 2004 read with Section 73 of the Finance Act, 1994, CENVAT credit cannot be denied during the refund proceedings under Rule 5 ibid. Applicability of Rule 5 of CCR - HELD THAT:- Even if the contention of the revenue was to be accepted then also the credit should have been denied by initiating the proceedings under Rule 14 and not in proceedings of refund under Rule 5 of CENVAT Credit Rules, 2004. There are no merits in the impugned order to the extent it has sought to disallow the CENVAT Credit to the extent of Rs.4088/- + Rs.1,09,63,679/- + Rs.6,60562/- + Rs.54,20,341/- = Rs.1,70,48,670/- for determining the “Net Cenvat Credit”, in the formula prescribed under Rule 5 of the CENVAT Credit Rules, 2004. Thus the Net Cenvat Credit for the application of this formula should have been Rs.3,82,73,665/- and eligibility to refund determined ACCORDINGLY. The difference of the amount allowed as refund and the amount debited from the CENVAT Account on 19.02.2013 should be allowed as credit in the account books of the appellant. Adjudicating authority should have allowed back the credit of entire amount of refund denied, to the appellant by his order and the appellant could have utilized the same for his domestic clearances. Having not done so adjudicating authority has gone beyond the provisions of CENVAT Credit Rules and Notification No.27/2012-CE (NT) dated 18.06.2012. As the law exists now the entire amount which was debited by the appellant at the time of filing this refund claim should be allowed as cash refund to the appellant in terms of the above provisions of CGST Act, 2017. Appeal allowed.
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