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| The Tax Publishers2020 TaxPub(EX) 39 CENVAT CREDIT RULES, 2004
Rule 5
Where refund of credit shall not be allowed only if drawback has been availed in respect of such duty and such duty in this case refers only to the excise duty because there is no mechanism of granting Cenvat credit of the basic customs duty. Since drawback scheme itself has provided for a single rate of drawback, which means only customs duty drawback, it was impossible that assessees could have availed drawback of central excise duty.
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Cenvat credit - Refund of unutilized Cenvat credit - Allowability of -
Assessees filed refund claims under rule 5 of CENVAT Credit Rules (CCR), 2004. These refund claims have been rejected by the lower authority holding that they were not entitled to the refund amount as they had taken drawback in respect of the same products in terms of Customs, Central Excise Duties & Service Tax Drawback Rules, 1995. First appellate authority allowed their appeals. Held: A plain reading of the proviso to rule 5 shows that refund of credit shall not be allowed only if drawback has been availed of in respect of such duty. Such duty in this case refers only to the excise duty because there is no mechanism of granting Cenvat credit of the basic customs duty. Since drawback scheme itself has provided for a single rate of drawback, which, according to the clarification in Notification No. 110/2015-CUS, dated 16-11-2015, means only customs duty drawback, it was impossible that assessees could have availed drawback of central excise duty. Therefore, appeal of Revenue was dismissed.
REFERRED :
FAVOUR : In assessee's favour
A.Y. :
IN THE CESTAT, HYDERABAD BENCH
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