Registration is not mandatory for claiming refund of CENVAT Credit
CONSEQUENT to the amendment to Rule 5 of the CENVAT Credit Rules, 2004 vide Notification No. 4/2006 CE(NT) dated 14.3.2006, exporters of output services have also become eligible for claiming refund of CENVAT Credit under Rule 5 of the CCR 2004. After the amendment, many service exporters have started claiming refund under the new provisions. In case of , among other grounds, the refund claim of the assessee was rejected on the ground that the assessee was not registered with the department and the benefits of CENVAT Credit scheme is available only to an assessee registered with the department. This view of the revenue was upheld by the Tribunal in the above order.
The assessee took the matter in appeal before the High Court of Karnataka. In its order , the High Court has made some interesting observations on the issue of whether it is mandatory for an assessee to obtain Central Excise Registration to avail the benefit of CENVAT Credit. The Court held:
++ Insofar as requirement of registration with the department as a condition precedent for claiming CENVAT credit is concerned, learned counsel appearing for both parties were unable to point out any provision in the CENVAT credit rules which impose such restriction. In the absence of a statutory provision which prescribes that registration is mandatory and that if such a registration is not made the assessee is not entitled to the benefit of refund, the three authorities committed a serious error in rejecting the claim for refund on the ground which is not existence in law. Therefore, said finding recorded by the Tribunal as well as by the lower authorities cannot be sustained. Accordingly, it is set aside.