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2019 (3) TMI 1750

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..... t Credit Rules and Notification dated 18-6-2012 is distinct and separate from the obligation under Section 11B of the Act. This Court concurs with the reasons assigned in the aforesaid decisions to hold that the Revenue would be obliged to pay under interest for the delayed refund as contemplated under Section 11BB of the Act even for the delayed refund of the unutilized Cenvat credit under Rule 5 of the Cenvat Credit Rules and Notification dated 18-6-2012. This Court is of the considered opinion that no substantial questions arise for consideration, and the appeals are dismissed - Decided against Revenue. - Central Excise Appeal Nos. 41 & 44 of 2018 - Dated:- 1-3-2019 - Ravi Malimath and B.M. Shyam Prasad, JJ. Shri K.V. Aravind, Advocate, for the Appellant. Shri Mihir Mehta with Smt. G.L. Shilpi Jain, Advocates, for the Respondent. JUDGMENT The appellant-Revenue has, in these appeals under Section 35G of the Central Excise Act, 1944, impugned the Final Order dated 21-2-2018 in No. 20300-20301 of 2018 by the Customs, Excise and Service Tax Appellate Tribunal, South Zonal Bench, Bengaluru (for short, Appellate Tribunal ). The Appellate Tribunal by this impugned order has allowed the .....

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..... ispute on the quantum and the consequential interest on such quantum of refund? 2. The present appeals arise in the following circumstances : The respondent offered Information Technology Software Services, as defined under the Finance Act, 1994, to its foreign clients under the Service Agreement concluded with them. The respondent furnished FIRCs, along with Export Invoices, to establish that it realized export proceeds in convertible foreign currency. The respondent filed its returns in Form ST-3. Thereafter, the respondent filed two claims with the Assistant Commissioner, Division C, Bengaluru for refund of Unutilized Cenvat credit for the period between October, 2012 to December, 2012 and October, 2013 to December, 2013 under Rule 5 of the Cenvat Credit Rules, 2004. The Assistant Commissioner, Division C, Bengaluru examined the respondent s claim for refund, and vide its separate orders dated 21-6-2017 allowed such claims for refund as provided for under Rule 5 of the Cenvat Credit Rules, 2004 read with Notification No. 27/2012-C.E. (N.T.), dated 18-6-2012 (for short, Cenvat Credit Rules & Notification dated 18-6-2012). However, the Assistant Commissioner, Division C, .....

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..... , if the claim for refund is under Section 11B of the Act. However, the present claim by the respondent is for the refund of the unutilized Cenvat credit under the Cenvat Credit Rules and Notification dated 18-6-2012. As such, the Department/Revenue cannot be called upon to pay interest for delay in refund of the unutilized Cenvat credit under Section 11BB of Act. The Learned Counsel elaborated that the claim for refund under Section 11B of the Act is in respect of excess duty paid or collected. If the excess duty is paid or collected, then upon receipt of an application as provided under Section 11B of the Act, the interest on delay in refund is payable under Section 11BB of the Act provided that excess amount is not refunded within three months from the date of receipt of such application under Section 11B(1) of the Act. Under Section 11BB of the Act, the interest on the excess duty paid or collected is payable from the date of receipt of application till the date of refund of such duty at such rate which is not below 5% and not exceeding 30% p.a. as is fixed by the Central Government by Notification in the Official Gazette. However, under Rule 5 of the Cenvat Credit Rules and No .....

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..... Therefore, the impugned order does not suffer from any irregularity or perversity. 9. The rival submissions are examined in the light of the decisions by the High Court of Gujarat as well as High Court of Madras. The High Court of Gujarat in the case of Commissioner, Central Excise v. Reliance Industries Limited supra, while considering a similar canvas against the payment of interest on delayed refunds under Section 11BB of the Central Excise Act, in terms of the obligation to refund under Rule 5 of the Cenvat Credit Rules and Notification dated 18-6-2012, did not accept the canvas on behalf of the Revenue that the scheme for refund of unutilized Cenvat credit is a special beneficial scheme with self contained procedure providing for the manner and method of its implementation, and hence any refund claimed under the Rules would be governed only by the provisions of the Scheme and the general provisions of Section 11BB of the Central Excise Act cannot be resorted to. The High Court of Gujarat concluded that the Cenvat credit is nothing but duty paid by the supplier of inputs which are dutiable goods manufactured by the supplier or dutiable services rendered by the service pro .....

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