At, Customs Excise Service Tax Appellate Tribunal Principal Bench New Delhi
By, THE HONORABLE JUSTICE: ASHOK JINDAL
For Petitioner: U. Sengraj, DR
1. The Revenue is in appeal against the impugned order wherein Learned Commissioner (Appeals) has granted refund claim to the respondent. The brief facts of the case are that the respondent are manufacturer of bulk drugs they have availed Cenvat credit on aluminium foils which has been used for packing the bulk drugs manufactured by them. The Cenvat credit is sought to be denied to the respondent on the premise that cutting, slitting of aluminium foils from jumbo rolls in their factory does not amount to manufacture, therefore, they are not entitled to avail Cenvat credit. Consequently two show cause notices were issued to the respondent dated 9-4-2012 and 4-5-2012 to deny Cenvat credit. After issuance of the show cause notices the respondent reversed the Cenvat credit. Later on, the show cause notices issued to the respondent were dropped in terms of the Notification No. 24/2012-C.E. (N.T.), dated 19-4-2012 wherein the respondent was entitled to avail Cenvat credit. Thereafter, the respondent filed refund claim of Cenvat credit reversed by them. The said refund sanctioned by the Adjudicating Authority and thereafter a show cause notice dated 14-3-2014 was issued to the respondent for erroneously refund made to them. The said show cause notice was adjudicated and refund claim was denied. On appeal, the Learned Commissioner (Appeals) allowed the refund claim in cash. Against the said order, the Revenue is before me.
2. The Learned AR appeared for the Revenue submits that there is no provision to give refund claim in cash, therefore, the impugned order is to be set aside. Moreover, the Learned Commissioner (Appeals) has relied on the decision of Hon'ble Supreme Court in the case of Union of India v. Slovak India Trading Co. Pvt. Ltd. - 2008 (223) E.L.T. A170 (S.C.). The same has been considered by the Larger Bench of this Tribunal in the case of Steel Strips v. CCE, Ludhiana : 2011 (269) E.L.T. 257 (Tri. - LB) and it was held that Cenvat credit cannot be given in cash. Therefore, the impugned order is to be set aside.
3. None appeared on behalf of the respondent nor there is any adjournment request. Considering the fact that the issue is in narrow campus, therefore, the appeal is taken up for final disposal.
4. Heard the Learned AR considered his submissions and perused the record.
5. On perusal of the record, I find that Cenvat credit sought to be denied to the respondent on premise that cutting/slitting of aluminium foils from jumbo rolls to sheet does not amount to manufacture and two show cause notices were issued one on 9-4-2012 and 4-5-2012. Admittedly, the Notification No. 24/2012-C.E. (N.T.), dated 19-4-2012 entitles to the respondent to avail Cenvat credit. Despite that, on 4-5-2012, the show cause notice was issued to the respondent to deny Cenvat credit and to absolve the liability against the show cause notices issued to the respondent, the respondent reversed the Cenvat credit on 14-6-2012, but the said show cause notices were dropped, therefore, the payment made by the respondent was under protest. As despite the Notification No. 24/2012-C.E. (N.T.), dated 19-4-2012 which entitles the respondent to avail Cenvat credit, the show cause notice dated 4-5-2012 was issued. As respondent had reversed the Cenvat credit under protest and the same could not utilised by them due to the reason that proceedings were going on against them and before the concluding of the proceedings, their factory was closed. In that circumstances, whatever duty has been paid by the respondent by reversal of Cenvat credit is required to be refunded to the respondent in cash as the same was not recoverable from the respondent at all. The Learned AR has relied on the decision of Larger Bench of this Tribunal in the case of Steel Strips (supra). The facts of the said case are altogether different, as in the said case Cenvat credit remain unutilised at the time of closure of the factory, but in this case, Cenvat credit reversed by the respondent was under protest, therefore, the said facts are not applicable to the facts of this cas
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e. As the show cause notices issued after Notification No. 24/2012-C.E. (N.T.), dated 19-4-2012 was against the spirit of law and the respondent had complied with the same, in that circumstances, the respondent is entitled for refund and the same has been allowed by the Learned Commissioner (Appeals) in the impugned order. In that circumstance, I do not find any infirmity in the impugned order. The same is upheld. Appeal filed by the Revenue is dismissed.