2013 (7) TMI 607 - CGOVT - Customs

Duty Drawback - assessee manufacture & export of Industrial Boilers & Vapour Absorption Chillers of various Models and Capacities for Industrial use on turnkey basis - the products were huge in size these were shipped in various lots considering the convenience of transportation, requirement on site & part shipments duty drawback application was made - Held that - the assessee was entitled for getting brand rate of Drawback fixed under Rule 7(1) of Drawback Rules, 1995 subject to compliance of revenue safeguards as stated - plain reading of said circular makes it clear that brand rate of drawback would also be admissible for the goods exported in CKD/SKD/ unassembled condition even if the All Industry Rate of Drawback is also there subject to certain revenue safeguards stated in the circular - no reason to deny when C.B.E. & C. Circular allows the same court relied upon Cummins (India) Ltd. v. CC, Pune (2012 (6) TMI 432 - CESTAT, Mumbai). purpose of drawback - Purpose of drawback was to relieve the burden of taxes on the export goods and to make our exports competitive in the international market - If this policy objective is to be achieved, then the Department has to interpret and implement the rules in a meaningful way so that the exporter gets the maximum benefit eligible as prescribed under the law - Adjudicating authority should have considered the claim made by assessee under Rule 7 if they had satisfied the eligibility M/s. Suksha International v. UOI (1989 (1) TMI 316 - SUPREME COURT) - interpretations of unduly restricting substantial export benefit which otherwise is due as per policy of government should be avoided revision decided in favour of assessee.

Summary

Issues:
Claim for fixation of Brand Rate of Duty Drawback under Rule 6(1)(a) of Duty Drawback Rules, 1995. Rejection of drawback claims under Rule 6(1) due to availability of All Industry Rates. Appeal before Commissioner (Appeals) and subsequent Revision Application under Section 129DD of Customs Act, 1962. Request for consideration under Rule 7(1) of Duty Drawback Rules, 1995 based on C.B.E. & C. Circular No. 26/2005-Cus., dated 8-6-2005 and G.O.I. Order No. 255/2012-Cus., dated 4-7-2012.

Analysis:
The Revision Application was filed against the Order-in-Appeal rejecting the Duty Drawback claim under Rule 6(1) of Duty Drawback Rules, 1995. The applicants sought condonation for wrongly filing under Rule 6(1)(a) and requested treatment under Rule 7(1) based on Circular No. 26/2005-Cus. The applicants argued that their claim amount exceeded 4/5 of FOB value of Exports, emphasizing the completeness of the exported products. The government noted the factual details and the prevailing All Industry DBK rate for the exported goods, leading to the rejection of the claim. The applicants relied on legal provisions and circulars to support their request for Brand Rate fixation.

The government analyzed the relevant circulars and legal precedents, emphasizing the admissibility of brand rate for goods exported in unassembled condition. The government referred to the Hon'ble Supreme Court's stance on adhering to plain readings and the legal binding nature of circulars on departmental authorities. The government highlighted the applicant's request for brand rate fixation under Rule 7(1) and the need to avoid unduly restricting export benefits. The government directed the original authority to fix the brand rate under Rule 7(1) based on compliance with revenue safeguards, setting aside the impugned orders and ruling in favor of the applicants.

In conclusion, the Revision Application succeeded based on the government's interpretation of the relevant rules and circulars, ensuring the applicants' entitlement to brand rate of Duty Drawback under Rule 7(1) of the Drawback Rules, 1995. The government's decision was in line with legal principles and policy objectives to support export competitiveness and relieve tax burdens, ultimately benefiting the applicants.