" (1) Appeal No. E/30274/2020 CUSTOMS, EXCISE AND SERVICE TAX APPELLATE TRIBUNAL HYDERABAD REGIONAL BENCH - COURT NO. – I Single Member Bench Excise Appeal No. 30274 of 2020 (Arising out of Order-in-Appeal No.TTD-EXCUS-000-APP-071-19-20, dated 20.12.2019 passed by Commissioner of Central Tax & Customs (Appeals), Guntur) M/s J S W Cement Ltd., .. APPELLANT Bilakalagudur Village, Gadivemula Mandal, Kurnool, Andhra Pradesh – 518 501. VERSUS Commissioner of Central Tax .. RESPONDENT Tirupati – GST No. 9/86, West Church Complex, Amaravathi Nagar, MR Palli Road, Thirupathi, Chittor, Andhra Pradesh – 517 502. APPEARANCE: Shri M.S. Nagaraja, Advocate for the Appellant. Shri V R Pavan Kumar, Authorised Representative for the Respondent. CORAM: HON’BLE Mr. A.K. JYOTISHI, MEMBER (TECHNICAL) FINAL ORDER No. A/30345/2024 Date of Hearing:25.07.2024 Date of Decision:31.07.2024 [ORDER PER: A.K. JYOTISHI] M/s JSW Cements Ltd (hereinafter referred to as Appellant) have filed an appeal against Order-In-Appeal No. TTD-EXCUS-000-APP-071-19-20, dated 20.12.2019. In the impugned order, Commissioner (Appeals) has upheld the Order passed by the Original Authority and dismissed the appeal filed by the appellant. The Original Authority had considered the request of the appellant for refund of Rs.12,98,114/- being the Service Tax paid under reverse charge mechanism on GTA services availed which they could not claim under Tran 1 form for transition into GST. The Original Authority, interalia, observed that Section 142 (3) of CGST Act, 2017 neither has any provision for giving refund of unclaimed credit on account of failure of the assessee in not carrying forward transitional credit under Tran-1 nor for the credits which could not availed due to late receipt of bill or late booking of (2) Appeal No. E/30274/2020 bills. The original authority further held that Section 142 (3) makes it very clear that every claim for refund file by any person, on or after the appointed day, the refund of any amount of CENVAT Credit, duty, tax, interest or any other amount paid under the existing law shall be disposed of in accordance with the provision of the existing law and in the instant case the appellant paid tax under the existing law but it is observed that there is no provision to refund such amount of service tax paid under reverse charge mechanism under the existing law. In view of the same the original authority rejected the refund claim. On appeal filled by the appellant the Appellate Authority i.e. the Commissioner (Appeals) held that under the existing law in terms of Section 142 (3) of CGST Act, 2017, there is no provision to refund such amount of service tax paid under reverse charge mechanism under existing law. Accordingly, Commissioner (Appeal) upheld the order of the original authority. 2. Learned Counsel for the appellant has mainly argued that since they paid the service tax post transition i.e. 01.07.2017, and they were otherwise entitled to take credit of the same, therefore they are entitled for refund of the same as CENVAT credit could not be availed by them, in terms of provisions of Section 142 (3) of the Act. He primarily relies on various case laws including Bosch Electrical Drive India Pvt. Ltd. Vs CCT, Chennai [2023 (12) TMI 1145-CESTAT, Chennai-LB] in support of their claim. He also heavily relied on the JSW Steel Ltd. decision in Final Order No. A/20452/2024 dated 31.05.2024 passed by Division Bench Hon’ble CESTAT, Bangalore in the case of JSW Steels Ltd., Vs CCT, Belgaum, stating that similar issue is decided in their favour. The appellant also relied upon certain decisions as follows: (i) Assistant Commissioner of GST and Central Excise, Puducherry – II Vs Ganges International Pvt Ltd. (3) Appeal No. E/30274/2020 [2023 (68) G.S.T.L. 134 (Mad)]. (ii) The Hon’ble CESTAT, Hyderabad in the case of OSI SYSTEMS PVT LTD., Vs CCT – [2022-TIOL-872-CESTAT-HYD] (iii) The Hon’ble CESTAT, Chennai in the case of TEREX India Pvt Ltd. Vs Commissioner of GST & CE, Salem [2022(63) G.S.T.L. 238 (Tri. – Chennai)] (iv) The Hon’ble CESTAT New Delhi in the case of Indo Tooling Pvt Ltd., Vs Commissioner, CGST & C.EX. Indore – [2022 (61) G.S.T.L. 595 (Tri – Del)] (v) The Hon’ble CESTAT New Delhi in the case of M/s Nitin Industries (Trade Name) Vs Commissioner of Goods and Service Tax – [2022-TIOL-1102-CESTAT-DEL] (vi) The appellant further relied upon the following decisions. (a) NIIT Ltd., Vs Commissioner of CGST [2023-TIOL-70-CESTAT-DEL] (b) Rawal WasiaIspat Udyog Pvt Ltd., Vs CCE, Panchkula [2019 (26) GSTL 196 (Tri-Chan)] (c) Thermax Ltd., Vs Union of India [2019-TIOL-1952-HC-AHM-CX] (d) SMG International vs CCE, Panchkula [2019 (21) GSTL 446 (TRI-CHAN)] (e) Oswal Castings Pvt Ltd., Vs CCE, Faridabad [2019 (24) GSTL 649 (T)] 3. Learned Counsel’s main thrust is that sub-section 3 of Section 142 provides for the submission of the claim for refund of any amount of CENVAT credit, duty, interest or any other amount paid under the existing law. Learned Counsel also argued that if CENVAT credit, duty, tax, interest or any other amount is found eligible and the benefit accrues whether claimant the benefit must be paid in cash without considering the limitation as prescribed in section 11 B (1) of the Central Excise Act 1944. 4. Learned DR, on the other hand supported the decision of Commissioner (Appeals) on the grounds that there is no provision under the existing law to grant refund of credit in respect of service tax paid under (4) Appeal No. E/30274/2020 reverse charge mechanism and the provisions under Section 142 (3) is quite clear that unless the refund of any such input credit is otherwise eligible under the existing law, the same cannot be considered for refund in cash in terms of under Section 142 (3). Learned DR also points out that specific miscellaneous transition provisions have been made under the Act itself and therefore as claimed by the appellant that they were otherwise entitled for refund under Section 142 (3) of the said Act, has to be examined in terms of the provisions under the said Section and Sub-Section. For the ease of reference, the provisions under Section 142 (3) is reproduced below: (3) Every claim for refund filed by any person before, on or after the appointed day, for refund of any amount of CENVAT credit, duty, tax, interest or any other amount paid under the existing law, shall be disposed of in accordance with the provisions of existing law and any amount eventually accruing to him shall be paid in cash, notwithstanding anything to the contrary contained under the provisions of existing law other than the provisions of sub-section (2) of section 11B of the Central Excise Act, 1994 (1 of 1944). 5. Learned DR main argument that the refund claim filed under sub- section 3 has to be disposed of in accordance with the provisions of existing law and the Section 142(3) does not independently provide any right to claim refund of any unutilized CENVAT credit without fulfillment of condition prescribed under the existing law. Learned DR has also relied on certain judgments in support of the claim that appellants were not entitled for refund in cash, as follows: (i) CAD VISION ENGINEERS PVT LTD. VERSUS COMMISSIONER OF CUSTOMS & CENTRAL TAX (APPEALS-I), HYDERABAD [2024 (5) TMI 72 - CESTAT HYDERABAD] (ii) M/S CYIENT LIMITED VERSUS THE COMMISSIONER OF CENTRAL TAX, RANGAREDDY- GST (5) Appeal No. E/30274/2020 [2024 (5) TMI 523 - CESTAT HYDERABAD] (iii) ARAGEN LIFE SCIENCES LTD VERSUS COMMISSIONER OF CENTRAL TAX SECUNDERABAD – GST [2024 (5) TMI 65 - CESTAT HYDERABAD] (iv) M/S RUNGTA MINES LIMITED VERSUS THE COMMISSIONER OF CENTRAL GOODS & SERVICE S TAX AND CENTRAL EXCISE, DIVISION I, JHARKHAND [2022 (2) TMI 934 - JHARKHAND HIGH COURT] (v) LATA HYDROCARBON RESOURCES PVT LTD VERSUS COMMISSIONER OF CENTRAL TAX, RANGAREDDY – GST [2019 (12) TMI 1060 - CESTAT HYDERABAD] (vi) M/S MAHAVIR METAL MANUFACTURING COMPANY VERSUS COMMISSIONER (APPEALS), CENTRAL EXCISE AND CGST, JODHPUR, RAJASTHAN [2023 (5) TMI 136 - CESTAT NEW DELHI] 6. Heard both the parties. 7. The crux of the issue is whether the appellant is entitled for refund in cash in respect of certain amount of service tax paid by them under reverse charge mechanism post 01.07.2017. The admitted fact is that the appellant has received certain bills after 01.07.2017 pertaining to service for the period prior to said date & the appellant has also admitted that they paid the service tax under reverse charge mechanism post 01.07.2017. 8. In order to appreciate the issue at hand, the provisions under Section 142(3) of the Act need to be examined. A plain reading of Section 142(3) would indicate that any claim for refund of any amount of CENVAT credit has to be disposed of in accordance with the provisions of the existing law and if any amount would eventually become due, the same is required tobe paid in cash, notwithstanding anything to the contrary contained under the provisions of existing law. The provisions of Section 142(3) are unambiguous, wherein it essentially indicates that if CENVAT credit were otherwise eligible for refund under the erstwhile Central Excise Act, the (6) Appeal No. E/30274/2020 same needs to be processed and allowed in accordance with the provisions of Section 142(3), therefore Section 142(3) of CGST does not provide for any independent statutory provisions to examine and allow the eligibility of refund on its own without any reference to the existing law. 9. Thus, it is apparent that Section 142(3) does not give any independent entitlement for granting refund of CENVAT credit which could not be utilized or transitioned on any count whatsoever. The erstwhile existing law has no provision for refund of unutilized or accumulated CENVAT credit except in the case of export. The perusal of CENVAT Credit Rules (CCR) 2004 under the existing law clearly evidence that refund of CENVAT credit can only be made under specific circumstances as prescribed under Rule 5, 5A and 5B and subject to certain procedures, conditions, limitations etc as may be notified by a notification in this regard. On examination it is found that there is no provision in the law either in the CENVAT Credit Rules 2004 or in Central Excise Act to allow cash refund, of unclaimed/accumulated credit. In the case of Banswara Syntex Vs CCE [2018 (91) TMI 1064] the Hon’ble Division Bench of Rajasthan High Court held that refund of accumulated unutilized credit on account of education cess and secondary and higher education cess was not entitled for cash refund, in view of there being no provision under the Central Excise Act 1944 and the rules made there under. In the case of Rani Plastic Pipe Industries the Division Bench of CESTAT, Hyderabad held that Rule 5 of CCR 2004 is the only provision under which refund of CENVAT credit can be allowed and that there is no provision in the CENVAT credit rules for refund of CENVAT credit if the assessee is not able to utilize it for any other purpose, such as the factory being closed (Para 10). In the case of Karnataka High Court decision in Slovak India Trading Company Pvt Ltd which was affirmed by Hon’ble Supreme Court, it was held that refund of (7) Appeal No. E/30274/2020 accumulated credit can be allowed as refund on account of closer of factory but the departmental SLP against said Karnataka High Court decision was dismissed by the Hon’ble Apex Court in view of the concessions. Further, in the case of Mahavir Metal Manufacturing Company [2023 (5) TMI 136 – CESTAT, NEW DELHI] and Lata Hydrocarbon Resources Pvt Ltd., [2019 (12) TMI 1060-CESTAT, Hyderabad] it is held that Slovak India Trading Company decision is applicable only for period prior to April 2012, as the amended Rule 5 does not permit refund of CENVAT credit which could not be utilized for any possible reason (Para 10). Therefore, the Slovak India decision is not relevant as the period of refund in the present case is post 01.04.2012. 10. The reliance placed by the Learned Council for the appellant on Ganges International Pvt Ltd. decision of Madras High Court Division Bench reported in [2023 (68) G.S.T.L. 134 (Mad.)] is misplaced. The Ganges International decision has only remanded the issue to be disposed of on merits. The relevant portion of the Ganges International decision is reproduced hereunder: “8. This court is of the view that what was impugned herein is only the order of remand passed by the learned Judge and hence, there is no requirement to set aside the same in entirety. However, this court is inclined to modify the order of the learned Judge to some extent. Accordingly, the same is modified by directing the appellant to consider the application of the assessee under section 142(3) of the CGST Act, 2017, based on the available materials and dispose the same, on merits and after affording an opportunity of hearing to the assessee, within a period of six weeks from the date of receipt of a copy of this judgment.” 11. The above decision of Division Bench of Madras High Court is unambiguous and clear wherein the department is directed to examine the application of the assessee under Section 142(3) of the CGST Act 2017 based on the available materials and dispose the same, on merits and after (8) Appeal No. E/30274/2020 affording an opportunity of hearing to the assessee. Thus, the remand order of Madras High Court is an open remand and the issue has to be decided on merits. In such a scenario the issue at hand i.e. cash refund of CENVAT credit under Section 142(3) is not decided by the Hon’ble Madras High Court, as such Ganges International decision is not of any help to the appellant herein. 12. The Learned Council reliance on the Bosch Electrical Drive India Pvt Ltd., decision CESTAT, Chennai Larger Bench decision is of no relevance, as the issue which was referred to the Larger Bench which is as under: “Whether a refund order passed under Section 142 of the Central Goods and Service Act, 2017 is appealable before the Customs, Excise and Service Tax Appellate Tribunal or otherwise?” (Para 1). “36. The issue that has been referred to the Larger Bench of the Tribunal is whether a refund order passed under Section 142 of the CGST Act is appealable before the Tribunal.” The reference made to the Larger Bench is answered as follows: “50. An appeal would lie to the Customs, Excise & Service Tax Appellate Tribunal against an order passed under section 142 of the Central Goods and Services Tax Act, 2017.” 13. From the above, it is quite discernible that the reference which was made to the Larger Bench is only as to whether refund order passed under Section 142 of CGST of 2017 is appealable before CESTAT or not. The CESTAT Larger Bench has answered that an appeal against such an order is maintainable before CESTAT. The remit of the Larger Bench is limited to the reference made to it. No other inference can be drawn from the Larger Bench decision except as to the maintainability of an appeal before CESTAT (9) Appeal No. E/30274/2020 against an order passed under Section 142 of the CGST Act. Hence, the Larger Bench decision in Bosch is not of any help to the appellant herein. 14. The Learned Council placed reliance on CESTAT Bangalore Division Bench Final Order No A/20452/2024 dated 31.05.2024, pertaining to JSW Steel, Bellary, Karnataka, wherein the appellant therein had filed a refund claim of Rs. 1,25,80,590/- being the differential duty of additional duty of Customs and SAD against 27 bills of interest on the ground that the appellant had made payment on finalisation of provision assessment after 01.07.2017 and that the amount paid cannot be carried forward to the GST. In this regard, the Learned DR pointed out that said decision of the Jharkhand High Court in the case of Rungta Mines (Supra) was not placed before or considered by the Hon’ble Tribunal in JSW Steel. It is apparent that the Jharkhand High Court decision in Rungta Mines and other identical decisions were not brought to the notice of the Hon’ble CESTAT Division Bench in the case of JSW Steel. In such a scenario, it is pertinent to note the decision of the Five Member Bench of Hon’ble CESTAT in the case of Kashmir Conductors, CCE, CHANDIGARH Versus KASHMIR CONDUCTORS [1997 (96) E.L.T. 257 (Tribunal)], wherein it is held that “however, there is a decision of only one High Court in regard to disputed interpretation or proposition of law, the Tribunal is bound to follow that order since it is not at liberty to disregard the solitary High Court decision.” (Para 10.2). Hence, the High Court’s decision of Jharkhand in the Rungta Mines case needs to be followed by CESTAT, in-spite of JSW Steel decision in their own case. In the Rungta Mines decision Hon’ble High Court categorically ruled that refunds under existing law are governed by Section 11B of Central Excise Act and that entire Section 11B does not sanction any refund where the assessee has failed to claim CENVAT credit as per CENVAT Credit Rules (10) Appeal No. E/30274/2020 2004 and has lost its right to claim such credit by claiming it within the time prescribed. The relevant paras are cited below: 42. It is not in dispute that the refunds under the existing law of Service Tax as well as Central Excise Act, 1944 are governed by section 11B of the Central Excise Act, 1944 and subsection 2 of section 11 B also refers to application for refund made under section 11 B(1) of Central Excise Act, 1944. Further section 11B(3) of Central Excise Act, 1944 clearly provides that all kinds of refunds including those arising out of judgement , decree or orders of court or tribunal are to be dealt with in accordance with the provisions of section 11B (2) of Central Excise Act, 1944 . It is also important to note that section 11B(2) of Central Excise Act, 1944 deals with the manner in which applications for refund under section 11B (1) are to be dealt with as it uses the word “such application” which is clearly referrable to section 11B (1) of 28 Central Excise Act, 1944. Further, the proviso to section 11B(2) deals with situations of rebate of duty; unspent advance deposits; principles of unjust enrichment in cases where duty of excise is paid by manufacturer or borne by buyer and who have not passed on the incidence of such duty to any other person; and also where duty of excise is borne by any other class of applicant as the central government may notify in official gazette with a further proviso regarding unjust enrichment. 43. The entire section 11B of Central Excise Act, 1944, as it stood immediately before the appointed date, does not sanction any refund where the assessee has failed to claim CENVAT Credit as per CENVAT Credit Rules, 2004 and has lost its right to claim such credit by not claiming it within the time prescribed. Further section 11B also has its own strict time lines for claiming refund. Rule 5 of the CENVAT Credit Rules provides for refund only when the inputs are used in relation to export, which is not the case here. These aspects of the matter have been rightly considered and decided against the petitioner while passing the impugned orders whose details have already been stated above. This proposition of law overrules any other proposition of law laid down by CESTAT, including the CESTAT’s Division Bench decision in JSW Steel Pvt Ltd. 15. Reliance placed by DR on the judgment of Hon’ble High Court of Jharkhand in the case of Rungta Mines Vs CCE, Jamshedpur [2022-TIOL- 252-HC-JHARKHAND-GST] is appropriate to appreciate the applicability and the scope of Section 142(3). A plain reading of Section 142(3) evidences that Section 142(3) does not confer a new right, which never existed under the existing law, if the person is not entitled for any right including refund (11) Appeal No. E/30274/2020 under the existing law. The relevant portion of the Rungta Mines High Court decision is reproduced hereunder. “45. The provision of section 142(3) does not entitle a person to seek refund who has no such right under the existing law or where the right under the existing law has extinguished or where right under the new CGST regime with respect to such claim has not been exercised in terms of the provision of CGST, Act and the rules framed and notifications issued. Meaning thereby, section 142(3) does not confer a new right which never existed under the old regime except to the manner of giving relief by refund in cash if the person is found entitled under the existing law in terms of the existing law. Section 142(3) does not create any new right on any person but it saves the existing right which existed on the appointed day and provides the modalities for refund in cash if found entitled under the existing law as the entire claim is mandated to be dealt with as per the existing law. It neither revive any right which stood extinguished in terms of the existing law nor does it create a new right by virtue of coming into force of CGST, Act. 46. Section 174 of the CGST Act read with section 6 of the General Clauses Act saves the right acquired, accrued or vested under the existing law and does not create any new right which never existed on the appointed day i.e on 01.07.2017 under the existing law. 47. The argument of the petitioner by referring to second proviso to section 142(3) of CGST Act that it indicates that section 142(3) would apply to the situations where the assessee has failed to take transitional credit under section 140(1), is also devoid of any merits. The second proviso only indicates that if the assessee has taken transitional credit he will not be entitled to refund. Certainly, an assessee cannot simultaneously claim transitional credit as well as refund of the same amount. The second proviso to section 143(2) cannot be said to be an eligibility condition to claim refund but is only a condition which governs refund as an assessee cannot be permitted to have transitional credit as well as refund of the same tax amount. 48. Section 140(5) applies under the circumstances where input services are received after the appointed day but the tax has been paid by the supplier under the existing law within the time and in the manner prescribed with a further condition that the invoice etc are recorded in the books of account of the such person within a period of 30 days from the appointed day. Section 140(5) also does not help the petitioner. Section 140 (5) has no applicability to the facts and circumstances of this case. In the instant case, admittedly the services in the nature of “port services” were received by the petitioner in the month of April 2017 and invoice was also generated in the month of May 2017.” (12) Appeal No. E/30274/2020 16. The ratio of the above judgement squarely applicable to the facts of the instant case as regards Section 142(3) of the Act. In the above judgement it was held that provisions of CGST Act do not cover any such situation relating to any consequences due to inter parte acts and omissions. It was also held that in that case as per the petitioner, the entire problem has cropped up due to non-receipt of invoice in original from port authorities although the port services were availed and payments for the same were made. In the present case also i.e. JSW Cement Pvt Ltd., the issue has cropped up because of late receipt of invoices bills in the last week of July 2017 in respect of input services received during the period March 2017 to June 2017 as admitted by the appellant. Therefore, as held in the Rungta Mines the late receipt of invoices is essentially between the appellant and its service provider and the tax collecting authorities had nothing to do in the matter. It was also held in Rungta Mines, that appellant never had a right to claim refund under the existing law. Thus, the Rungta Mines decision is exactly applicable to the instant case. 17. Therefore, having regard to the rival submissions, citations and arguments, I find there is no infirmity in the order passed by the Commissioner (Appeals), upholding the order of the Original Authority, who had rejected the claim of refund in cash filed by the appellant. Accordingly, the appeal filed by the appellant is liable to be dismissed. 18. Appeal dismissed. (Order Pronounced in open court on 31.07.2024) (A.K. JYOTISHI) MEMBER (TECHNICAL) jaya "