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Corporate News *  Missing seized records must be considered while testing ITC claim; duplicate GST demands ordered corrected: Delhi High Court. *  GST appeal can’t be rejected without addressing taxpayer’s grounds: Allahabad High Court. *  Surplus IGST credit can offset CGST, SGST shortfall: GSTAT. *  GST refund can’t be denied when cancelled airfares are returned with tax: GSTAT. *  3 Hearing notices issued within 2 minutes: Gujarat High Court flags portal flaw, seeks report. *  GSTR-9, GSTR-9C filing for FY 2025-26 enabled; pending GSTR-1 and GSTR-3B must be filed first. *  Dupattas are exempt fabrics, can’t be taxed as fibres at 4%: Madras High Court. *  Full transitional credit allowed on capital goods received after GST rollout: GSTAT denies Rs. 6.99 lakh export duty credit. *  GST return mismatch alone can’t justify fraud proceedings: GSTAT orders fresh adjudication under section 73. *  Supplier found non-existent later can’t alone justify input tax credit denial: GSTAT. *  GST interest stops once tax reaches government account, can’t run until return filing: GSTAT. *  Cancelled flat booking- GST refund can’t be denied without excluding COVID period from limitation: GSTAT. *  India notifies rules of origin for India–New Zealand FTA. *  Incomplete E-bike kits classifiable as complete vehicles, but not eligible for CKD duty concession: CESTAT. *  Same GST rate on main input and output can’t by itself bar inverted duty refund: GSTAT. *  Unjust enrichment doesn’t apply to customs refunds from assessments finalised before July 13, 2006: Gujarat High Court. *  CENVAT credit can’t be denied solely because plant And machinery are embedded in earth: Karnataka High Court. *  DFIA exports ineligible for RoDTEP benefits; customs directs repayment with applicable interest. *  Second E-Way bill alone doesn’t prove another supply: GSTAT. *  Bail denied in Rs. 1.19 crore fake GST refund case over risk of accused absconding again: Punjab and Haryana High Court. *  GST registration can be restored after revocation deadline if outstanding dues are paid: Gauhati High Court. *  Multiple GST proceedings over same suppliers: Calcutta High Court directs dept. to share findings for adjudication. *  E-Governance portal services not OIDAR, fixed deposit interest not taxable: CESTAT. *  Rs. 500 Stamp duty required on authority letters for CAs, CMA and GST practitioners in Pune GST division.  *  Rs. 1.10 crore GST refund must be paid in cash after business closure: Allahabad High Court. *  Godown rent attracts 18% GST even when used exclusively for exempt agricultural warehousing: AAR. *  GST portal launches "Multi-State Registration" facility: one master TRN for registration applications across multiple States/UTs. *  RoDTEP scheme extended till 31st December, 2026.  *  Mere disagreement with order can’t override Rs. 20 lakh appeal limit: GSTAT. *  Customs interest can’t be backdated before confiscation liability is determined; nearly 8 year period excluded: Delhi High Court.
Subject News *  GST summons: anticipatory bail maintainable without arrest order, but relief denied in evasion case: Allahabad High Court. *  GST Appeal can’t be decided without hearing taxpayer’s objections to fresh evidence: Allahabad High Court. *  GST ITC can’t be reversed merely because supplier grants discount without reducing tax liability: GSTAT. *  Mere quoting of GST provision is not a valid charge: GSTAT quashes ITC denial. *  Personal hearing mandatory before adverse GST order, even without taxpayer’s request: Rajasthan High Court. *  Parallel bail pleas without full disclosure amount to abuse of process Rs. 43.08 crore GST case sent for fresh hearing: Supreme Court. *  GST refund based on unchallenged advance ruling can’t be recovered using later circular: GSTAT. *  Payment of GST alone doesn’t end interest and penalty liability when tax and interest remain unpaid beyond 30 days of notice: GSTAT. *  GST demand over builders’ 80% procurement rule requires reasoned adjudication: GSTAT. *  Eligible ITC doesn’t automatically entitle taxpayers to compensation cess refund on domestic sales: GSTAT. *  GST confiscation order passed before reply deadline invalid: GSTAT. *  GST interest can’t be retained after tax refund on delayed export receipts: Punjab & Haryana High Court. *  GST appeal can’t be dismissed over pre-deposit shortfall without opportunity To respond: Bombay High Court. *  DGGI SCN can’t be challenged before reply and adjudication:Chhattisgarh High Court. *  GST input tax credit can’t be denied solely due to supplier’s retrospective registration cancellation: GSTAT. *  GST notice must explain fraud allegations; merely repeating section 74 Is not enough:  Himachal Pradesh High Court. *  Audit detection alone can’t justify GST fraud penalty; specific suppression must be proved: GSTAT. *  GST order uploaded only under ‘Additional Notices’ tab without separate intimation set aside: Calcutta High Court. *  Service Tax appeal can’t be rejected for missing pre-deposit proof when payment is already recorded: CESTAT. *  SGST dept. can’t hear appeal against CGST order: Calcutta High Court. *  Mere dispatch of tax order can’t prove service or make appeal time-barred: CESTAT. *  Dealer incentives can’t be taxed merely on ledger entries: CESTAT. *  DGFT orders quashed for failure to supply DRI letter relied upon in SCN: Bombay High Court. *  GST penalty u/s 122(1A) can’t apply to Pre-2021 transactions; unregistered beneficiaries also covered: Delhi High Court. *  Expired E-way bill caused by wrong PIN code can’t justify GST penalty without intent to evade tax: GSTAT. *  Used railway rails can’t be taxed as track material without proof they are fit for reuse: CESTAT. *  Earlier DGGI notice doesn’t bar separate GST demand on different issue: Delhi High Court. *  ITC dispute involves no question of law: GSTAT directs appeal to Vice-President. *  Earlier DGGI notice doesn’t bar separate GST demand On different issue: Delhi High Court. *  No E-way bill required for interstate goods movement in november 2017: GSTAT quashes detention and penalty.  

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PJ/CASE LAW/2016-17/3139

Whether rebate claim be sanctioned by way of credit disputed to be granted in cash?

Case:-JOHN DEERE INDIA PVT LTD VS COMMISSIONER OF CENTRAL EXCISE, PUNE-III

Citation:- 2016-TIOL-1313-CESTAT-MUM

Brief Facts:-This appeal is directed against Order-in-Appeal No. PIII/VM/84/2011 dated 26/04/2011.The appellant herein is engaged in providing Consulting Engineering Service and has exported the said service by paying the service tax amounting to Rs.7052644/-. After export was done, they filed a rebate claim in terms of Export Service Rules, 2005. Lower authority sanctioned the rebate claim by way of credit to Cenvat account of the appellant.

Appellants Contention:-Appellant is aggrieved by such an order, as according to them, the Cenvat credit cannot be utilized as exports of the services are more than the domestic clearances and rebate claim should be sanctioned to them in cash.

Reasoning Of Judgement:-On careful consideration of the submissions made by both the sides and perusal the records, Tribunal find that Ld. Counsel was correct in emphasizing that the rebate claim should be paid in cash. It is settled law that the debit of an amount in Cenvat account is considered as discharged of tax liability. Our views are fortified by the judgments of Hon'ble High Court of Uttarakhand in the case of Apco Pharma Ltd. - 2015 (319) ELT 641 = 2011-TIOL-913-HC-UKHAND-CX, they reproduce ration contained in para no. 20:
"20. Upon hearing the learned counsel, the Court finds that the adjudicating authority had sanctioned the refund claimed by way of credit in their RG23A Part II account. 20. The Court finds that the assessee is availing exemption and is not in a position to utilize the credit and if the assessee is not able to utilize the credit, the very basis of the refund is defeated. Consequently, the Commissioner (Appeals) was justified in giving the assessee the cash refund of the credit. In Commr. of Cen. Ex. vs. Ashok Arc, 2006 (193) ELT 399 = 2007 (7) STR 365 , the High Court of Jharkhand held that the assessee is entitled for the refund in cash. In view of the aforesaid, the submission of the learned counsel for the appellant cannot be accepted."
In view of the foregoing and in the facts and circumstances of this case, we set aside the impugned order and allow the appeal with consequential relief.

Decision:-Appeal allowed.

Comment:- The essence of the case is that rebate claim should be sanctioned in cash rather than by way of credit to the cenvat account if it is not possible for the exporter to utilise cenvat credit. This is supported by the remarkable judgment of High Court in the case of Apco Pharma Ltd. The rebate sanctioned by way of cenvat credit may prove to be futile if it is not possible to utilise the cenvat credit as the very basis of the refund is defeated.
 
Prepared By:- Neelam Jain
 
 

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