CESTAT rules on refund claims under the Central Excise Act
The appellant inadvertently applied to a wrong forum
The Chennai branch of the Customs Excise and Service Tax Appellate Tribunal (CESTAT) has held that the refund claim made before a wrong forum cannot be rejected by treating it as time-barred by invoking the Central Excise Act, 1944.
The appellant, Hivelm Industries (HI) had supplied isolators and spares to DVC Koderma Thermal Power Project State 1 owned by Damodar Valley Corporation (DVC) through the main contractor Bharat Heavy Electricals Limited.
The deemed exports were exempted from payment of duty vide the June 2006 notification, as amended.
However, the appellant made the payment since its name did not figure in the project certificate issued by DVC. Because of this misinformation, in December 2011, DI applied for a refund before the Directorate General of Foreign Trade (DGFT), Chennai, but it was rejected.
Thereafter, the appellant filed an appeal before the DGFT, New Delhi. It also filed a refund claim before the excise authorities in July 2014.
The Judicial Member P Dinesha observed, “It is not in dispute that the deemed export did not attract any Excise Duty and hence, it is not the duty of the appellant/taxpayer to repeatedly plead before the authorities that the project in which it was involved was a deemed export.”
He added, “Moreover, the fact that the appellant filed its refund claim immediately, though, before a wrong forum, itself proves the bona fides of the appellant and hence, the same establishes the fact that there was an application for a refund claim within the limitation period prescribed in the statute.”