IN THE HIGH COURT OF PUNJAB AND HARYANA AT
CHANDIGARH
C.E.A. No. 15 of 2009
DATE OF DECISION: February 10, 2009
M/s Rama Industries Ltd.
...Appellant
Versus
Commissioner of Central Excise, Chandigarh
...Respondent
CORAM: HON'BLE MR. JUSTICE M.M. KUMAR
HON'BLE MR. JUSTICE H.S. BHALLA
Present: Mr. Jagmohan Bansal, Advocate,
for the appellant.
Mr. Sanjeev Kaushik, Central Govt. Sr. Counsel,
for the respondent.
1. Whether Reporters of local papers may be
allowed to see the judgment?
2. To be referred to the Reporters or not?
3. Whether the judgment should be reported in
the Digest?
M.M. KUMAR, J.
This is an appeal directed against order dated 17.10.2008 (P-4),
passed by the Customs Excise and Service Tax Appellate Tribunal, New
Delhi (for brevity, ‘the Tribunal’) holding that the appellant cannot be given
the refund in cash from Cenvat credit account. Learned counsel for the
appellant has urged that the following substantial questions of law would
arise for determination of this Court:-
“a) Whether refund in cash of Cenvat credit can be allowed
in case of closure of the manufacturing unit?
C.E.A. No. 15 of 2009 2
b) Whether impugned order of the Tribunal is justified in
view of judgment of Karnataka High Court in the case of
Union of India v. Slovak India Trading Co. Pvt. Ltd.,
2006 (2001) E.L.T. 559 (Kar.)?”
We have heard learned counsel for the parties and have perused
the paper book with their able assistance. The matter is covered against the
revenue by the Division Bench judgment of Karnataka High Court in the
case of Union of India v. Slovak India Trading Co. Pvt. Ltd., 2006
(2001) E.L.T. 559 (Kar.), wherei
n it has been held that Rule 5 of Cenvat Credit Rules, 2002 (for brevity, ‘the
Rules’) in terms does not prohibit refund in cash of Cenvat credit. On a
further appeal against the aforesaid judgment of the Division Bench to the
Supreme Court, Special Leave Petition has been dismissed by holding that
the revenue did not file any appeal against many such orders passed by
Tribunals at Delhi and Mumbai. The Tribunal at Delhi has passed one such
order in the case of Eicher Tractors v. CCE, Hyderabad, 2002 (147)
E.L.T. 457 (Tri.-Del.), whereas the Tribunal at Mumbai had passed three
such orders, namely, Shree Prakash Textiles (Guj.) Ltd. v. CCE,
Ahmedabad, 2004 (169) E.L.T. 162 (Tri.-Mumbai); CCE, Ahmedabad
v. Babu Textile Industries, 2003 (158) E.L.T. 215 (Tri.-Mumbai); and
CCE, Ahmedabad v. Arcoy Industries, 2004 (170) E.L.T. 507 (Tri.-
Mumbai). The Tribunals in all the aforementioned cases have held that the
assessee is entitled to refund in cash of the amount deposited if the assessee
has gone out of the Modvat Scheme or his unit is closed. The Supreme
Court has considered all the aforementioned decisions. Before the Supreme
Court it was conceded by the revenue that no appeal had been filed against
C.E.A. No. 15 of 2009 3
the orders of the Tribunal. Therefore, the order of the Division Bench of
Karnataka High Court was upheld.
In view of the above, both the questions of law raised by the
learned counsel for the appellant deserves to be answered in favour of the
assessee and against the revenue.
(M.M. KUMAR)
JUDGE
(H.S. BHALLA)
February 10, 2009 JUDGE
Pkapoor