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TMI Blog2019 (8) TMI 73X X X X Extracts X X X X X X X X Extracts X X X X ..... Sewing Machine Needles falling under Chapter 84523090 of CETA, 1985. The appellants are 100% EOU and are availing CENVAT credit of duty paid on inputs, capital goods and input services as per CENVAT Credit Rules, 2004. During the course of audit on the verification of records maintained by the appellant, the Department observed that the appellants have irregularly availed CENVAT credit of Rs. 1,03,437/- on debit notes for the period from June 2007 to January 2011. Based on these allegations, the Department issued a SCN dated 19.12.2011 proposing to deny and recover the said CENVAT credit of Rs. 1,03,437 with interest and proposed to impose penalty under Rule 15 of CCR, 2004. After following the due process, the original authority vide order ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of Service Tax, input service and not with respect to the refund of the amount appropriated. Being aggrieved by the refusal to refund the CENVAT credit in cash, the appellant filed appeal before the Commissioner and the Commissioner rejected the appeal on the ground that there was no direction from the Commissioner (Appeals) to refund the amount and the appellant has not challenged the refund order in which the amounts have been appropriated. 3. Heard both the parties and perused the records. 4. Learned Counsel for the appellants submitted that the impugned order is contrary to the facts and the evidences on record. He further submitted that it is an admitted fact that the Department has permitted an amount of Rs. 2,20,836/- towards the d ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... once the Order-in-Original has been set aside and the adjudicating authority has allowed the credit then the original authority should have also refunded the amount appropriated wrongly. In support of this submission he relied upon the decision of the CESTAT in the case of Ispat Trders Vs CC, Jamnagar reported in 2011 (263) ELT 305 (Tri. Ahmd.). He further submitted that this order of the Tribunal has been upheld by the Hon'ble High Court of Gujarat as reported in 2013 (298) ELT A111 (Guj.). 5. On the other hand, Learned AR defended the impugned order and submitted that since the appellant has not challenged the appropriation and there was no direction in the remand order for sanctioning and returning the refund amount therefore that appro ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... as held that appropriation of the amount out of the refund amount payable in cash towards the demand confirmed in the said Order-in-Original is only a pre-deposit and once the said Order-in-Original has been set aside by the first Appellate Authority, the adjudicating authority in all fairness ought to have sanctioned the refund of the amount appropriated. This decision of the Tribunal has been upheld by the Hon'ble Gujarat High Court as cited supra. 7. In view of my discussion above, I am of the considered opinion that the impugned order refusing to refund the amount of Rs. 2,20,836/- is not sustainable in law and therefore the same is set aside by allowing the appeal of the appellant with consequential relief, if any. (Operative portion ..... X X X X Extracts X X X X X X X X Extracts X X X X
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