CBIC Policy decision cannot run contrary to Court Judgment to Deny Refund of Cess

Nu Vista Limited Vs Commissioner (Appeals) CGST, Central Excise (CESTAT Delhi)

It is not in dispute that prior to 01.03.2015 cess was leviable on manufactured goods, in addition to excise duty and the appellant had availed credit under the provisions of the Credit Rules on cess paid on procurement of goods and services. It is also not in dispute that by a notification dated 01.03.2015, levy of cess was exempted. The closing balance of credit of cess as on 28.02.2015, therefore, could not be utilized by the appellant and it was carried forward by him in the central excise returns.

The Assistant Commissioner, by order dated 12.11.2018, rejected the refund claim.

The submission of learned counsel for the appellant is that refund of credit of cess cannot be denied merely on the ground that such credit which could not be utilised prior to GST regime would stand lapsed.

In Kirloskar Toyota, the Tribunal while examining whether refund claim of accumulated balance of unutilised credit of cess available in the books, can be refunded under section 11B of the Central Excise Act 1944²¹ and held, in view of the aforesaid Division Bench decision of the Tribunal in Bharat Heavy Electricals, as also the decisions of the Supreme Court and the Karnataka High Court in Slovak India Trading that an assessee is entitled to refund of unutilised credit of cess after the introduction of GST.

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