2025(09)LCX0044

Mumbai Tribunal

JSW STEELS LIMITED

Versus

COMMISSIONER OF CGST & CENTRAL EXCISE

Excise Appeal No. 85599 of 2022 decided on 03-09-2025

CUSTOMS

CUSTOMS, EXCISE & SERVICE TAX APPELLATE TRIBUNAL
MUMBAI

WEST ZONAL BENCH, MUMBAI

Excise Appeal No. 85599 of 2022

[Arising out of Order-in-Appeal No. NA/119/RGD APP/2021-22 dated 22.07.2021 passed by the Commissioner of Central Tax (Appeals), Raigad.]

M/s JSW Steel Limited                                                 ........Appellant
Geetapuram, Village: Dolvi,
Tal.- Pen, Raigad, Maharashtra – 402 107

VERSUS

Commissioner of CGST & Central Excise, Raigad .......Respondent
4th Floor, Kendriya Utpad Shulk Bhawan,
Plot – 01, Sector – 17, Khandeshwar,
Raigad, Maharashtra – 410 206

APPERANCE:

Shri Kartik Dodhia, Advocate with
Ms. Anushka Mhatre, Advocate for the Appellant

Shri P.K. Acharya, Superintendent, Authorised Representative for the
Respondent

CORAM:

HON’BLE DR. SUVENDU KUMAR PATI, MEMBER (JUDICIAL)

FINAL ORDER NO. 86313/2025

Date of Hearing: 04.07.2025
Date of Decision: 03.09.2025

Rejection of refund of CVD/SAD paid after 01.07.2017 that is after CGST has come into force, in respect of Bill of entries filed prior to 01.07.2017 upon final assessment made the Refund Sanctioning Authority, that received approval of the Commissioner (Appeals) vide his above referred order in an appeal preferred before him by the unsuccessful Assessee-Appellant, is assailed in this appeal.

2. Facts of the case, in a nut shell, is that Appellant is a manufacturer of steel and imported iron ore / iron ore fines. Through 03 Bills of Entries and cleared its imported goods upon provisional assessment. After the finalisation of assessment, Appellant had paid CVD and SAD of Rs.45,54,866/- between July, 2018 and July, 2019 but could not avail CENVAT Credit that was discontinued in the GST regime. Accordingly, Appellant sought for refund of the said amount in cash citing provision contained in Section 142(3) of the CGST Act but it was disallowed by the Refund Sanctioning Authority as well as by the Commissioner (Appeals). Legality of the said order of the Commissioner (Appeals) is questioned by the Appellant before this forum.

3. I have heard submissions from both the sides. With reference to several decisions passed on the issue in the case of Bosch Automotive Electronics India Pvt. Ltd. (Larger Bench), Bosch Automotive Electronics India Pvt. Ltd. (Service Tax Appeal No. 40010 of 2020), Shakti Pumps (I) Ltd. [2024 (7) TMI 541 – CESTAT New Delhi], Spacewood Furnishers Pvt. Ltd. (Excise Appeal No. 85371 of 2021) Mumbai Bench, Salvi Chemical Industries Ltd. [2025 (1) TMI 987 – CESTAT Mumbai], Clariant Chemicals India Ltd. [2022 (10) TMI 796 – CESTAT Mumbai], Alcon Biosciences Pvt. Ltd. Vs. Commissioner of CGST & Central Excise, Mumbai [2024 (6) TMI 178 – CESTAT Mumbai], SI Group India P Ltd. Vs. The Commissioner of CGST and Central Excise, Belapur [2024 (10) TMI 324 – CESTAT Mumbai], Rankuno Interactive Technologies Pvt. Ltd. Vs. Commissioner of CGST & Service Tax, Pune-II Commissionerate – [2025 (6) TMI 1265 – CESTAT Mumbai], learned Counsel for the Appellant Mr. Kartik Dodhia submitted that issue is now well settled that Assessee is entitled to refund of CVD and SAD paid after 01/07/2017 by invoking Section 142(3) of the CGST Act and even Hon'ble High Court of Bombay in the case of Combitic Global Caplet Pvt. Ltd. [WP/729/2021-OS] had also held that Section 142(3) of the CGST Act is wide enough to encompass not only CENVAT Credit but also “any other amount”, for which order passed by the Commissioner (Appeals) is required to be set aside.

4. In response to such submission, learned Authorised Representative for the Respondent-Department Mr. P.K. Acharya has argued in support of the reasoning and rationality of the order passed by the Commissioner (Appeals) and in citing judicial decision passed by Hon'ble High Court of Jharkhand in the case of M/s. Rungta Mines Ltd. Vs. Commissioner of CGST and CX [2022-TIOL-252-HCJharkhand-GST] he further argued that provision of Section 142(3) does not entitle a person to seek refund who has no such right under the existing law and even without referring to the said judgment also, learned Commissioner had given similar findings that since CENVAT Credit is not refundable to a manufacturer who is not exporting goods, it can’t get refund by invoking Section 142(3) of the CGST Act. He further argued with reference to the decision of Hon'ble High Court of Madras passed in the case of M/s. Ganges International Pvt. Ltd. Vs. Assistant Commissioner of GST & Central Excise passed in W.P. No. 528 of 2019 that such credit can only be carried forward to the electronic credit ledger, if permissible but not to be refunded to the Assessee-Appellant, for which interference in the order passed by the Commissioner (Appeals) is uncalled for.

5. I have gone through the submissions, decided case laws on the issue and on the point of application of Section 142(3) in granting refund of CVD and SAD in cash. It can be said that Larger Bench of the Tribunal in the case of M/s. Bosch Automotive Electronics India Pvt. Ltd. in Service Tax Appeal No. 40010 of 2020 has decided the issue that such relief can be granted by this Tribunal and taking note of several decisions passed by the Tribunal on this issue alone in the case of Sri Chakra Poly Plast India Pvt. Ltd. Vs. Medchal - GST on 18th January 2024, this Tribunal was analysed those divergent decisions on the issue and had given its finding in favour of grant of refund in cash of CVD and SAD paid by the Assessee, relevant portion of the said order is worth reproducing here:

“17. In all these case laws, the issue was identical i.e., as to whether CVD+SAD as part of Custom Duties paid subsequent to 01.07.2017 on account of non-fulfilment of Export Obligation, are eligible for cash refund when the Appellant cannot take these amounts as Cenvat Credit. The co-ordinate Benches of Tribunal have been consistently holding that the Appellant would be eligible for Cenvat Credit. The issue in the present appeal is squarely covered by these decisions.

18. In the case of OSI Systems Pvt Ltd vs CCT, Rangareddy [2022 (9) TMI 801 - CESTAT Hyderabad], this Bench while dealing the issue as to whether the Service Tax paid on RCM basis subsequent to 01.07.2017, which otherwise is eligible as Cenvat Credit, can be taken as cash refund under Sec.142(3) of CGST Act, 2017 was considered and has held as under:

"7. Having considered the rival contentions, I find that under transitional provision under section 142(3) of CGST Act, the limitation has been done away with and the only thing required for refund under the facts and circumstances is to see whether unjust enrichment is attracted. In the facts and circumstances, I hold that no unjust enrichment is attracted as the appellant have admittedly paid service tax in August, 2018 out of their own pocket. Accordingly, I allow this appeal and set aside the impugned order. The adjudicating authority is directed to grant refund within a period of 60 days from the date of receipt of copy of this order along with interest under section 11BB of the Central Excise Act."

19. I find that the ratio laid down in the above case law is also squarely applicable to the facts of the present case.

20. Now coming to the case law of Servo Packaging Ltd and Aurobindo Pharma Ltd., cases, cited by Learned AR, subsequently Chennai Bench itself has passed another Order holding that Appellant would be eligible for cash refund. Further, the view of the Bench in the cases of Servo Packaging Ltd.,& Aurobindo Pharma Ltd., were prior to the clear view brought in by the Larger Bench in the case of Bosch Electrical Drive India Pvt Ltd., (cited supra),which has held as under:

"49. In the present case, the service tax was paid under the provisions of Chapter V of the Finance Act and refund was claimed under sub-section (3) of section 142 of the CGST Act, under which the claim was required to be disposed of in accordance with the provisions of the existing law. Therefore, even if the service tax had been deposited by the appellant after 01.01.2017, nonetheless the refund of any amount of the CENVAT credit could be claimed only under subsection (3) of section 142 of the CGST Act and against this order an appeal will lie to the Tribunal."

21. Therefore, I find all the case laws cited by learned AR cannot be applied now. On the other hand, the decisions of Mithila Drugs Pvt Ltd., (supra), Clariant Chemicals India Ltd., (supra) and ITCO Industries Ltd., (supra) cited by Learned Counsel read with Bosch Electrical Drive India Pvt Ltd., (Larger Bench) are squarely applicable.”

Admittedly in the above said decision of Sri Chakra Poly Plast India Pvt. Ltd. cited supra, these two judgments referred by learned Authorised Representative namely M/s. Rungta Mines Ltd. cited supra and M/s. Ganges International Pvt. Ltd. cited supra were not discussed but the same has been noted in my previous order passed in the case of SI Group India P Ltd. cited supra at para 5 that would bring clarity to the fact that those judgments were passed in a separate context, apart from the fact that Section 142(3) had not dealt with refundable credit only since it has provided provision for refund of ‘any amount of CENVAT Credit, duty, tax, interest or any other amount paid’ under the existing law namely under the Excise Act in the present scenario. It would be relevant now to reproduce para 5 of the said SI Group India P Ltd., cited supra order that would provide further clarity to the issue.

“5. I have been gone through the case record and relied upon judgments. While accepting contention of the learned counsel for the Appellant that refund of such Cenvat Credit under section 142(3) in cash is admissible, as per the Judicial President of this Tribunal including that of the Larger Bench constituted on the issue in case of M/s. Brose India Automotives Systems Private Limited cited supra, there is no express contrary finding available in those two judgments referred by learned authorised representatives for the Department as in both the cases, the findings were to the effect that express provision though was not available in the existing Act (Now erstwhile Excise Act and Cenvat Credit Rules, 2004) for cash refund, Assessee is eligible to take cenvat credit amount so paid under the Service Tax Rules and even in the Ganges International Pvt. Ltd judgments cited supra, it was also directed that such provision as available under section 142(3) could be treated as a dire necessity and by invoking “Doctrine of Necessity” relief can be granted to the Appellant in such kind of quasi-judicial/ administrative matter.”

6. Therefore, when Section 146(6) of the CGST Act, 2017 commands this Tribunal to dispose of claim of CENVAT Credit in accordance with provision of existing law namely the Excise Act and if any credit found to be admissible to the claimant should be refundable to him in cash, notwithstanding anything to the contrary contained under the provision of Excise Act, Appellant is entitled to get the refund of credit admissible to it on account of payment made towards CVD and SAD even though such amount was not directly refundable under the existing law since Section 142(6) is confined to claim of CENVAT Credit and not to a claim of refund of CENVAT Credit alone. Hence the order.

THE ORDER

7. The appeal is allowed and the order passed by the passed by the Commissioner of Central Tax (Appeals), Raigad vide Order-in-Appeal No. NA/119/RGD APP/2021-22 dated 22.07.2021 is hereby set aside. Appellant is entitled to get cash refund of Rs.45,54,866/- with applicable interest as per law and the Respondent-Department is directed to pay the same within two months of receipt of this order.

(Order pronounced in the open court on 03.09.2025)

(Dr. Suvendu Kumar Pati)
Member (Judicial)