2025-VIL-238-CESTAT-MUM-CE
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CENTRAL EXCISE CESTAT Cases

Central Excise - Refund of balance of Education Cess and Secondary & Higher Education Cess lying as on 30.06.2017, GST Transitional Provisions – Rejection of refund on the ground that there is no provision under the CENVAT Credit Rules, 2004 for cash refund of such excess credit - Whether the appellant is eligible for refund claim of Cenvat credit in respect of Education Cess and Secondary & Higher Education Cess lying in credit balance in ER-1 return as on 30.06.2017, in terms of the transitional provisions under Section 142(3) and 142(9)(b) of the CGST Act, 2017 - HELD - The appellant is eligible for refund of the excess CENVAT credit of Education Cess and Secondary & Higher Education Cess, in terms of the transitional provisions under Section 142(3) and 142(9)(b) of the CGST Act, 2017 – The Section 142(3) of the CGST Act specifically provides for refund of any amount of CENVAT credit, duty, tax, interest or any other amount paid under the existing law, to be paid in cash, notwithstanding anything to the contrary contained under the provisions of the existing law - when the Central Excise Act, 1944 amongst other laws relating to old tax regime was repealed by Section 174 of the CGST Act, 2017 and that the CCR is also being superseded vide Notification No.20/2017-C.E. (N.T.) dated 30.06.2017, by the Central Government for smooth implementation of transfer to GST regime in indirect taxation, it is not feasible to make a specific provision in CENVAT statute, for enabling cash refund of excess CENVAT credit relating to earlier regime while moving to the new GST regime - the appellants are eligible for refund of excess CENVAT credit paid by them, and specifically allowed to be refunded in terms of Section 142(9)(b) of the CGST Act, 2017 – Further, providing refund of CENVAT credit in accordance with the provisions of existing law, cannot be interpreted to mean that the existing CENVAT Credit Rules, 2004 provided only for refund in specified situations as stated in Rule 5, and hence cash refund of CENVAT credit is not permissible, as it has been specifically enabled under Section 142 of the CGST Act. Such a narrow interpretation of transitional provision is not correct interpretation of legal provisions of the law - The Tribunal observed that the CENVAT credit earned by the appellant is a vested right, and the same cannot be taken away merely due to the change in the taxation regime from Central Excise/Service Tax to GST, unless there is a specific provision to that effect - the impugned order is set aside and the appeal is allowed
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