2015 (3) TMI 994 - CGOVT - Central Excise

Denial of partial rebate claim - applicant exporter was sanctioned rebate claims by the original authority to the extent of duty payable on F.O.B. value as shown in respective shipping bills, which has been taken as transaction value in terms of provisions of Section 4(3)(c)(iii) of the Central Excise Act, 1944 - Held that - original authority has found the FOB value declared in Shipping Bills as the transaction value in terms of Section 4 of Central Excise Act, 1944. He has given detailed findings which are upheld by Commissioner (Appeals) also. - As such the CIF value cannot be the value in terms of Section 4 of Central Excise Act, 1944. - The provisions contained in said Para 3(b)(ii) clearly stipulate that Assistant Commissioner of Central Excise/Deputy Commissioner of Central Excise having jurisdiction over factory of manufacture or the Maritime Commissioner of Central Excise if satisfied after scrutinizing the rebate claim that said claim is in order, he shall sanction the rebate either in whole or in part. The sanctioning of rebate claim in whole or in part will depend on admissibility of claim as per laid down parameters. So the provisions of Notification authorizes the Maritime Commissioner of Central Excise to sanction the rebate claim only to the extent it is admissible. The C.B.E. & C. Circular, dated 3-2-2000 was issued prior to the said Notification No. 19/2004-C.E. (N.T.), dated 6-9-2004. So the provision of Notification will prevail. Original rebate sanctioning authority has already examined the rebate claims in the manner elaborated above. Further the Commissioner (Appeals) herein has also after due consideration of the same has upheld the sanction of said rebate claims upto the limit of duty payable on FOB value which was transaction value of goods in this case. Government finds itself in conformity with the findings in said orders. Government therefore upholds the impugned Order-in-Appeal being perfectly legal and proper. - Decided against assessee.

Summary

Issues:
1. Rebate claim on the value of exported goods.
2. Determination of transaction value under Section 4 of the Central Excise Act, 1944.
3. The authority to sanction rebate claims.
4. Legal position regarding the correctness of assessments for rebate claims.

Issue 1: Rebate claim on the value of exported goods:
The applicant, engaged in the manufacture of electric motor cars for export, claimed rebate on the duty paid in respect of goods exported. The dispute arose regarding the value declared for rebate, specifically concerning the components of freight and insurance. The applicant argued that since no duty was paid on freight and insurance components, the original rebate sanctioned was in order. The applicant relied on Circulars and case laws to support their contention that the assessment should not be challenged if the duty liability was discharged on a higher value. The Central Government noted the applicant's arguments but ultimately upheld the original authority's decision to restrict the rebate based on the declared FOB value in the shipping bills.

Issue 2: Determination of transaction value under Section 4 of the Central Excise Act, 1944:
The case involved a dispute over the transaction value of the exported goods, with the applicant claiming that the CIF value should be considered as the transaction value for rebate purposes. The Central Government referred to a previous order to establish that the CIF value cannot be the value under Section 4 of the Central Excise Act, 1944. The Government upheld the original authority's decision to consider the FOB value declared in the shipping bills as the transaction value, in line with Section 4 provisions.

Issue 3: The authority to sanction rebate claims:
The applicant argued that the jurisdiction to determine the correct value of goods cleared for export lies with the jurisdictional officers of the factory and not with the Maritime Commissioner. However, the Central Government clarified that the Notification issued under Rule 18 of the Central Excise Rules, 2002 authorized the Maritime Commissioner to sanction rebate claims to the extent they are admissible. The Government emphasized that the Notification's provisions would prevail over any previous circulars.

Issue 4: Legal position regarding the correctness of assessments for rebate claims:
The applicant contended that the correctness of assessments should not be questioned if the duty was paid on a higher value. The Central Government examined the case laws and found that the original rebate sanctioning authority had already scrutinized the claims in detail. The Government upheld the Commissioner (Appeals) decision to maintain the rebate claims up to the duty payable on the FOB value, considering it as the transaction value of the goods. Consequently, the revision application was rejected for lacking merit.

Overall, the Central Government's judgment focused on interpreting the relevant legal provisions and case laws to determine the admissibility of the rebate claims based on the declared values of the exported goods and upheld the decisions of the lower authorities in this regard.