2008 (4) TMI 657 - AT - Central Excise

Summary

Issues involved: Whether refund of Cenvat credit of AED paid on inputs under Additional Duties of Excise (Textiles and Textile Articles) Act, used in the manufacture of final product exported under rebate claim under Rule 18 of Central Excise Rules on payment of duty, is available under Rule 5 of Cenvat Credit Rules, 2002.

Comprehensive Details:

1. The issue in this appeal revolves around the availability of refund of Cenvat credit of AED paid on inputs under the Additional Duties of Excise (Textiles and Textile Articles) Act for the manufacture of final products exported under a rebate claim under Rule 18 of the Central Excise Rules on payment of duty. The Tribunal referred to a previous decision in the case of CCE v. Indo Dane Textile Industries, where it was clarified that the rebate claim under Rule 18 is specific to duty paid on excisable goods, not additional excise duty on inputs. Therefore, the application for refund of additional excise duty through Cenvat credit under Rule 5 was deemed appropriate in this scenario.

2. The Tribunal further elaborated that the exporters in question had not exported goods without payment of excise duty, making Rule 19 inapplicable. Since no additional excise duty was payable on the final products, the rebate claim was rightly made only for the specific excise duty under Rule 18. As such, the application for refund of additional excise duty paid on inputs, through Cenvat credit under Rule 5, was found to be valid as they had not claimed rebate under Rule 18 for such additional duty.

3. The Revenue subsequently filed an appeal, which was dismissed by the Hon'ble Punjab and Haryana High Court based on the aforementioned decision. Given the clarity provided by the previous ruling and the alignment of the case at hand with the legal provisions, the appeal by the Revenue was deemed to lack merit and was consequently dismissed.

4. In conclusion, the Tribunal upheld the decision of the Hon'ble Punjab and Haryana High Court, affirming the availability of refund for additional excise duty paid on inputs through Cenvat credit under Rule 5, in cases where rebate claims under Rule 18 were specific to basic excise duty on final products exported.