2026-VIL-701-GUJ-CE
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CENTRAL EXCISE High Court Cases

Central Excise - Cenvat credit and suo motu re-credit - Rebate on export of goods under Rule 18 of the Central Excise Rules read with Section 11B of the Central Excise Act - Petitioner prayed for sanction of the rebate claim or alternatively allowing re-credit of Cenvat credit amount said to have been wrongly utilized - Since the Revision Application remained undecided, petitioner suo motu re-credited the amount in the Cenvat Account and informed the respondent authorities - The Revision Application was rejected by holding that the suo motu credit taken by the applicants needs to be recovered from them - Whether there is provision in law for suo motu re-crediting of the amount into the Cenvat Account and whether such action is backed up by any provision of law in the Statute - HELD - It is true that there is no provision under the Statute for suo motu re-crediting the amount to Cenvat Account but ultimately it appears that the Petitioner got frustrated in view of the pendency of the Revision Application and after informing the respondent authorities the re-credit was taken and deposited in the Cenvat Account - When an assessee reverses the credit there is only an account entry reversal and factually there is no outflow of funds from the assessee to result in filing application claiming refund of duty - The contention of the Revenue that even in reversal of the entry there is bound to be an unjust enrichment has no substance or based on any legal principle - In view of the fact that the rebate claim of the Petitioner is not disputed and in order to salvage the situation and lay quietus to the litigation the Court approved the action of the Petitioner in taking the suo motu credit of Cenvat credit with a clarification that the present order shall not be treated as a precedent - The writ petition is allowed
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