Customs, Excise & Service Tax Appellate Tribunal, South Zonal Bench At Chennai

India Trimmings Pvt. Ltd. V. Commissioner of Central Excise, & Service Tax, Coimbatore

Appeal Nos. ST/684-686/11 [Arising out of Order-in-Appeal No.165-11 to 167-11 dated 29.9.2011 passed by the Commissioner of Customs, Central Excise & Service Tax (Appeals), Coimbatore. 29-08-2012


The appellants are in appeal against the impugned orders where the refund claims were dismissed on the ground that the same have not been filed within one year of the duty paid.

2. The facts of the case are that the appellants are 100% EOU. During the course of their manufacturing activity, they have availed credit on inputs and input services. After manufacturing the goods, they exported the goods. These facts are not in dispute. Initially, the SCNs were issued to the appellants for reversal of the CENVAT credit availed both on inputs and input services as they are not eligible for the same. The said dispute was settled by the Commissioner (Appeals) in favour of the appellants holding that appellants are eligible to avail CENVAT Credit on the input and input services on 28.1.2009. Thereafter, the appellants filed refund claims on 13.8.2009 and 5.11.2009 respectively for the period April 2007 to September 2008. The refund claims were denied as time-barred as per clause (6) of Notification No.5/06 under Rule 5 of CENVAT Credit Rules,2004. Against the said orders, the appellant is before me.

3. The learned counsel for the appellants submits that as there was a dispute of eligibility of CENVAT credit availed by them, therefore unless and until the dispute is settled, they are not entitled for refund claims and when the dispute was settled in their favour on 28.1.2009, within one year of the said order, they have filed the refund claims. Therefore, they are entitled for refund claims as per Notification No.5/06. To support his contention, he placed reliance on the decision of this Tribunal in the case of CCE Indore Vs Indorama Exports - 2010 (254) ELT 147 (Tri.-Del.) and Dena Snuff Pvt. Ltd. Vs Commissioner - 2003 (157) ELT 500 (SC).

4. On the other hand, the learned SDR strongly opposed the contention of the learned counsel and submitted that notification is to be construed strictly and as per clause (6) of the Notification No.5/06, the appellants are required to file refund claim within one year as stated in Section 11B of the Central Excise Act,1944 for availment of the credit. Admittedly, they have not filed refund claims within time. Therefore, they are not entitled for refund claims. To support his contention, he relied on the decision of CCE Hyderabad Vs Sunder Steels Ltd. - 2005 (181) ELT 154 (SC) and Utttam Industries Vs CCE Haryana - 2011-TIOL-23-SC-CX.

5. Heard both sides. Considered their submissions.

In this case, these facts are not in dispute that initially CENVAT credit availed by the appellant was denied and the same was settled in their favour on 28.1.2009 and within one year of 28.1.2009, they have availed refund claims. As per Notification No.5/06, the assesses are required to file a refund claim within the time prescribed under Section 11B of the Central Excise Act. As per Section 11B of the Act, the assessees are required to file a refund claim within one year from the relevant date and the limitation of one year shall not apply where duty has been paid under protest. From the facts of the case, it is clear that whether the appellants are entitled for refund or not was in dispute. Therefore, it cannot be said that the CENVAT credit availed by them is the date of availment of credit. That dispute was settled only on 28.1.2009. Therefore, the facts of the case of Indorama Exports (supra) are squarely applicable to the facts of this case wherein this Tribunal had held that limitation shall begin when lis ends. Therefore, as per Notification No.5/06, the appellants are entitled for refund from the relevant date i.e. settlement of the dispute between the parties. Therefore, the appellants have filed refund claims within the time prescribed as per Notification No.5/06. In view of these observations, the appeals are allowed with consequential relief.

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