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synopsis of recent ruling of Hyderabad CESTAT Bench in the case of United Seamless Tubular (P) Ltd

synopsis of recent ruling of Hyderabad CESTAT Bench in the case of United Seamless Tubular (P) Ltd:

I am sharing with all a brief synopsis of recent ruling of Hyderabad CESTAT Bench in the case of United Seamless Tubular (P) Ltd. (2019-VIL-210-CESTAT-HYD-CE).

The Tribunal confirmed the application of first proviso to Section 142(3) of GST Acts (Transitional Provision) which states that “if any claim for refund of CENVAT credit is fully or partially rejected, the amount so rejected shall lapse”. The argument of the assessee that Had they taken credit of CENVAT, the same could have been transferred as ITC under the GST law by virtue of TRAN-1. It would be unfair for them to lose the credit for this reason” was out rightly rejected.


The relevant observation of the Tribunal was “The proviso to Section 142(3) of CGST Act, 2017 deals with the cases of rejection of credit of CENVAT Credit. It specifically indicates that such amounts shall lapse. It is true, that with better planning, the appellants could have taken back the credit of CENVAT of refund which was rejected. Such credit would have seamlessly got transferred as ITC under GST into their new account post introduction of GST Acts, but they have not done so”.


Facts of the case of United Seamless Tubular (P) Ltd are produced below:

  • Refund claim as per rule 5 of CCR, 2004 was filed which was partially rejected by the Tribunal (It is to be noted that while filing an application for refund, the amount needs to be debited from the CENVAT account);
  • After losing the CESTAT appeal on merits (Order was passed before GST law came into force), the amount should have been credited back to the CENVAT account but was not done appellant;
  • The appellant had again represented to the lower authority for refund of this amount in cash. As the issue had already been decided by CESTAT, the lower authority again rejected the request of the appellant for refund via letter;
  • Aggrieved by this letter, the appellant appealed to the first appellate authority who again rejected the refund claim;
  • Thereafter, appeal before Tribunal (the observations are already mentioned supra) was filed against the impugned order.    

Attached complete order.

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