2017 (11) TMI 1779 - CGOVT - Central Excise

Rebate claim - N/N. 21/2004-C.E. (N.T.), dated 6-9-2004 - inputs used in the manufacture and supply of one Pre-Fabricated Steel Building supplied to M/s. Kalyani Global Engineering Pvt. Ltd. on A/c Kalyani Alstom Power Ltd., located in the SEZ, Mundra Kutch, Gujarat - rejection of rebate on the ground that the applicant had not followed the conditions and procedure under N/N. 21/2004 - Held that - The Government is of the view that even though the above-mentioned procedure is a very important feature of Notification No. 21/2004, it will not be fair if the applicant is denied the benefit of rebate of duty in the above circumstances just because they could not follow the above procedure/conditions. It is not denied by the Assistant Commissioner and the Commissioner (Appeals) also that it was their first export of the goods to the SEZ and subsequently they have followed the procedure of prior intimation to the jurisdictional Assistant Commissioner and prior approval of input-output ratio to enable the Central Excise authorities to examine the admissibility of the rebate claims of the exporter. In the instant case the goods are engineering goods and its raw material etc. can be verified even subsequently with due care and diligence and it is all the more subsequently by the applicant and the jurisdictional Assistant Commissioner has already determined the input-output ratio in their subsequent case. The applicant has even submitted Chartered Engineer s certificate which can also be a guiding factor in this matter. Thus, the admissibility of rebate claim can be determined in this case even when the above-mentioned conditions/procedure of Notification. No. 21/2004 were not followed by the applicant earlier. The case is remanded to the Assistant/Deputy Commissioner of the Division with a direction to decide the matter regarding admissibility of the rebate claims of the applicant afresh after considering all relevant details/documents submitted by the applicant and which are already available on the Division/Range office - revision allowed by by of remand.

Summary

Issues:
Rejection of rebate claims under Notification No. 21/2004-C.E. (N.T.) for duty paid on inputs used in the manufacture of Pre-Fabricated Steel Building supplied to SEZ unit due to procedural lapses.

Analysis:
The applicant, engaged in manufacturing Pre-Fabricated Steel Buildings (PFSB), filed rebate claims under Notification No. 21/2004-C.E. for duty paid on inputs used in supplying a PFSB to an SEZ unit. The adjudicating authority rejected the rebate claims citing non-compliance with the notification's conditions and procedures. The Commissioner (Appeals) upheld the rejection, leading to a Revision Application challenging this decision. The applicant argued that the use of duty paid inputs in supplying to the SEZ unit was undisputed, and any omissions were procedural lapses, not warranting denial of rebate.

During a personal hearing, the applicant's advocates reiterated the grounds for revision and provided additional submissions supported by case laws. Despite the absence of the respondent during the hearing, the Government examined the case records. It was noted that while there was no dispute regarding the supply of PFSB to the SEZ unit and the use of duty paid inputs, the rebate claims were rejected solely due to the applicant's failure to inform, obtain permission, and furnish input-output ratio before export, as required by the notification.

The Government acknowledged the importance of following the notification's procedures but deemed it unfair to deny rebate benefits solely based on procedural lapses, especially considering this was the applicant's first export to the SEZ. The applicant had subsequently followed the required procedures for their exports, and the jurisdictional Assistant Commissioner had approved rebates in similar cases. The submission of relevant documents and a Chartered Engineer's Certificate further supported the applicant's case.

Consequently, the Commissioner (Appeals)'s decision was set aside, and the case was remanded to the Assistant/Deputy Commissioner for a fresh determination of the rebate claims. The Assistant/Deputy Commissioner was directed to consider all relevant details and documents submitted by the applicant, providing them with a full opportunity to present their case before making a decision.

Therefore, the Revision Application was disposed of, with the case remanded for a reevaluation of the admissibility of the rebate claims in light of the applicant's compliance efforts and supporting documentation.