Kkalpana Industries India Limited Vs C.C.E. & S.T. (CESTAT Ahmedabad)
The appeals arose from an audit of the appellant’s records concerning service tax paid on Ocean freight. According to the audit’s contention, Ocean freight was liable to service tax and the appellant accordingly paid the service tax. The appellant subsequently filed a refund claim on the ground that although it was entitled to CENVAT credit, it was not in a position to utilise the credit due to the GST regime and therefore sought refund.
The Adjudicating Authority rejected the refund claim on the ground that the service tax on Ocean freight had been paid on the insistence of audit and, therefore, there was suppression of fact. It held that under Rule 9(1)(bb) of the CENVAT Credit Rules, 2004, the appellants were not entitled to CENVAT credit and consequently were not entitled to refund. The Commissioner (Appeals) concurred with the view taken by the Lower Authority and upheld the Order-in-Original, leading to the present appeals.
For the appellants, Shri S J Vyas submitted that the alleged charge of suppression of fact had not been decided. Consequently, there was no established suppression on the basis of which CENVAT credit could be denied under Rule 9(1)(bb). Reliance was placed on Swami Construction Vs. C.C.E. & S.T.-Vadodara-I, Wellknown Polyester Ltd. Vs. C.C.E. & S.T.-Daman and M/s Columbia Machine Engineering India Pvt. Ltd. Vs. C.C.E. & S.T. Vadodara-I. The appellant also submitted that the Adjudicating Authority and Commissioner (Appeals) had held that cash refund of CENVAT credit was not available under Section 11B and contended that Section 11B was not applicable to the present case.
