Refund Claims must be sanctioned in Cash after GST Rollout: CESTAT
The Customs, Excise and Service Tax Appellate Tribunal ( CESTAT ), Chandigarh bench has held that the authorities cannot credit the refund claims in Cenvat credit account after the rollout of Goods and Services Tax ( GST ) from 1st June 2017.
The appellant filed refund claims of unutilized amount lying in their Cenvat credit account under Rule 5 of Cenvat credit Rules 2004, on account of export of goods. The refund claims partly allowed in cash and partly credited in Cenvat credit account. Before the authorities, the appellants contended that after the introduction of Central Goods and Service Tax Act, 2017 all refund claims are to be sanctioned in cash.
They further sought to modify the orders of sanctioning of refund claims in Cenvat account for granting the refund claims in cash. The Tribunal noticed that on introduction of Central GST Act, 2017, Section 142 deals the situation which directs the authorities to sanction all the refund claims in cash, therefore, no authority can sanction refund claim to be credited in Cenvat credit account. “In that circumstances, I modify the impugned orders to the extent that refund claims are to be allowed in cash, instead of crediting in Cenvat credit account. Accordingly, the appellant has entitled the refund claims in cash,” the Tribunal said.