Order date – 17 August 2022

Facts – 

• The Respondent, M/s. GANGES INTERNATIONAL PRIVATE LIMITED, is engaged in the manufacture of GI Tower Parts, ERW Black and GI Pipes falling under Chapter 73 of the Central Excise Tariff Act, 1985. 
• In the course of such business, they had received technical know-how / intellectual property right from foreign persons and paid royalty to them during the period from April 2016 to June 2017. For the said services received by them, they were liable to pay service tax under reverse charge basis, which was not paid by them originally. 
• After pointing out the same in the departmental audit, they had paid the service tax liability of Rs.24,20,684/- along with interest at Rs.3,82,139/- on 02.05.2018.
• Thereafter, the Respondent filed an application for refund. The appellant rejected the claim of refund made on the premise that there is no provision in the new regime to allow such refund as input tax credit in GST/credit in Electronic cash ledger/ payment in cash. 
• The said order was put to challenge by the Respondent in which it was held that because the transitional provision has come into effect from 01.07.2017, the chance of making an application under section 140(1) to seek the refund or otherwise of the credit, which was subsequently accrued in the account of the assessee, cannot be denied, therefore remanded back the matter.
• Aggrieved the appellants filed an appeal.

Issue – 

• Whether the order to reconsider the application of refund filed by assessee is sustainable?

Order – 

• The Court observed that it is an admitted fact that the assessee is eligible to claim Cenvat credit under the erstwhile Central Excise Act, prior to 30.06.2017, but they were unable to claim, due to transitional provision has come into effect from 01.07.2017. 
• The Court observed that the Respondent is entitled to avail Cenvat credit of the Service tax already paid, but they were unable to claim, due to transitional provision has come into effect from 01.07.2017, and so was the decision of adjudicating authority.
• Therefore, the court held 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. 
• The order of the learned Judge was modified by directing the appellant to consider the application of the Respondent 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 Respondent, within a period of six weeks from the date of receipt of a copy of this judgment.
• Appeal dismissed.