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2011 (11) TMI 325 - AT - Central ExciseRebate claim filed under Rule 18 of Central Excise Rules, 2002 on export of processed cotton fabric on payment of duty - duty paid from the accrued deemed credit on non-duty paid grey fabrics in terms of Notification No.53/2001-CE (NT) dt.29.6.01 and 6/2002-CE (NT) dt.1.3.02 - grey fabric being input in processing of cotton fabric Held that - The issue stands decided in favor of assessee by the various decisions of the Tribunal holding that credit of duty paid on yarn, chemical and other inputs used in the manufacture of grey fabrics, which are further inputs for the processed fabrics, would be available to the manufacturer of processed fabrics. Thus, rebate claim is granted. See CCE, Ahmedabad vs. Suzuki Synthetics (2007 - TMI - 3065 - CESTAT, Ahmedabad)
Issues:
- Processing of cotton fabrics for export and rebate claim under Rule 18 of Central Excise Rules, 2002. - Denial of rebate claim by Revenue due to processing from non-duty paid grey fabrics. - Dispute regarding availing credit of duty paid on inputs used in manufacturing grey fabrics. - Appeal against the orders of the Assistant Commissioner and Commissioner (Appeals) by the Revenue. - Applicability of Tribunal judgments in similar cases to the present case. Issue 1: Processing of cotton fabrics for export and rebate claim under Rule 18 of Central Excise Rules, 2002 The respondents were engaged in processing cotton fabrics for export and filed a rebate claim under Rule 18 of Central Excise Rules, 2002. They claimed that the processed cotton fabric was exported after payment of duty, which was paid from accrued deemed credit as per specific notifications. Issue 2: Denial of rebate claim by Revenue due to processing from non-duty paid grey fabrics The Revenue contended that since the processing was done from non-duty paid grey fabrics, the credit of duty paid on inputs like yarn, dies, chemicals, and packing materials could not be availed by the processors. Consequently, the wrongly availed credit was deemed unavailable for payment of duty on the final processed fabric. Issue 3: Dispute regarding availing credit of duty paid on inputs used in manufacturing grey fabrics The Revenue initiated proceedings against the respondents to deny the rebate claim based on the above contention. However, the Assistant Commissioner adjudicated the show cause notices in favor of the respondents, sanctioning the rebate claim. Issue 4: Appeal against the orders of the Assistant Commissioner and Commissioner (Appeals) by the Revenue The Revenue, dissatisfied with the decisions of the Assistant Commissioner and Commissioner (Appeals), filed appeals before the Appellate Tribunal challenging the grant of rebate claim to the respondents. Issue 5: Applicability of Tribunal judgments in similar cases to the present case The Tribunal, after considering various decisions, including the case of Mangal Textiles Mills Pvt. Ltd., held that the manufacturer of processed fabrics was entitled to deemed credit of duty paid on inputs used in manufacturing grey fabrics. The Tribunal cited precedents where similar disputes were settled in favor of the assessee, emphasizing the availability of deemed credit for grey fabrics used in processing. Consequently, the Tribunal upheld the impugned orders and rejected the appeals filed by the Revenue, citing consistency with previous decisions. In conclusion, the Tribunal's judgment affirmed the availability of deemed credit for manufacturers processing non-duty paid grey fabrics, in line with established precedents and legal interpretations, thereby dismissing the Revenue's appeals.
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