2019 (2) TMI 78 – CESTAT CHENNAI – TMI – Refund of accumulated / unutilized CENVAT credit – closure of manufacturing activity – applicability of Rule 5 of CENVAT Credit Rules, 2004 – whether relevant Rule 5 of CENVAT Credit Rules deals with situation of export and not of closure of factory? – Held that:- The Hon’ble High Court of Karnataka in the case of Slovak Trading Co. Pvt. Ltd. [2007 (1) TMI 556 – SUPREME COURT] had occasion to analyze the very same issue and held that even though there is no provision for grant of refund on account of closure of factory, since the appellant has gone out of the CENVAT credit scheme, they are eligible for refund – denial of refund is not justified – appeal allowed – decided in favor of appellant. – App
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2004. In appeal, Commissioner (Appeals) upheld the same. Hence this appeal. 2. On behalf of the appellant, ld. counsel Ms. S. Sridevi submitted that the lower authorities have rejected the refund stating that there is no provision in CENVAT Credit Rules to grant refund of amount of accumulated / unutilized credit on account of closure of factory. The relevant Rule 5 of CENVAT Credit Rules deals with situation of export and not of closure of factory. It is argued by her since the appellants have closed down the factory and surrendered their central excise registration, they are eligible for the accumulated credit. She relied upon the decision of the Hon ble High Court of Karnataka in the case of Union of India Vs. Slovak Trading Co. Pvt. Ltd
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ition in terms of Rule 5 that CENVAT credit shall not be refunded when the factory is closed down. Similar view was taken by the Tribunal in the case of Commissioner of Central Excise Vs. Kores India – 2009 (245) ELT 411 (Tri. Bang.). The decision in Slovak TradingCo. Pvt. Ltd. (supra) was followed by the Hon ble High Court of Rajasthan in the case of Welcuredruges and Pharmaceuticals Ltd. Vs. Commissioner of Central Excise – 2018 (8) TMI 1169. 6. Following the above decisions, we are of the opinion that the denial of refund is unjustified. The impugned order disallowing the refund is set aside and the appeal is allowed with consequential relief, if any. (Operative portion of the order was pronounced in open court) – Case laws – Decisions
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