2016 (9) TMI 1172 - AT - Central Excise

Export of goods procured against CT-1 certificate after processing and not in the same condition - entitlement of benefit of Notification No. 42/2001 CE(NT) dated 26.06.2001 - contravention of condition of Notification - Held that - there is no allegation against the appellant for non filing of undertaking/declaration of the department and the fact of the goods has not been disputed by both the sides. In that circumstances, on the decisions of I.O.C Ltd. Vs. Commissioner of Central Excise, Calcutta-II 2004 (6) TMI 222 - CESTAT, KOLKATA is applicable to the facts of this case wherein this tribunal observed that the commissioner in his order has also admitted that the documents have been filed and the facts of export have been accepted. The department s grievance is that the superintendent of Central Excise did not attend the export. It was not required. The appellant was governed by self removal procedure and to such cases Rule 173-0 was applied. It was the appellant s option to export under supervision of either the Excise authorities or the Customs Authorities. The commissioner is competent to relax the procedural provision under Rule 12/13 or the Central Excise rules, 1944. In the instant case, it was incumbent upon the Commissioner to grant relaxation from the procedure from the procedural provisions. This Tribunal has observed that when the show cause notice itself admits that export have been taken place after, there is no procedural irregularities in removal of the goods otherwise the SRN was not cleared, then the refinery operations would have come to stoppage. In this case, it is not disputed the goods procured by the appellant has been exported, therefore, I hold that the appellant has complied with conditions of the said notification and there is no demand of duty is sustainable against the appellant. - Decided in favour of appellant

Summary

Issues:
- Alleged misuse of CT-I certificates for procurement of excisable goods without payment of duty.
- Contravention of provisions of Central Excise Rules and Notification No. 42/2001 CE(NT) dated 26.06.2001.
- Denial of rebate claim due to alleged fraudulent rebate claim.
- Dispute over compliance with conditions of the notification for availing benefits.

Analysis:
1. Misuse of CT-I Certificates: The appellant was accused of obtaining CT-I Certificates for excisable goods without paying duty and using them as raw materials for manufacturing different products instead of exporting them in their original packed condition. This led to a show cause notice for recovery of excise duty and penal action. The adjudicating authority initially denied the rebate claim but granted the benefit of the notification, which was contested by the Revenue.

2. Contravention of Rules and Notification: The Commissioner (A) held that the appellant had violated the conditions of Notification No. 42/2001 CE(NT) dated 26.06.2001 by not exporting the goods in their original packed condition as required. The appellant challenged this decision, arguing that the goods procured under CT-I certificates were ultimately exported, complying with the notification's substantial conditions.

3. Denial of Rebate Claim: The rebate claim made by the appellant was called into question as the inputs were allegedly procured under CT-I Certificates without paying Central Excise Duty. The adjudicating authority denied the rebate claim, emphasizing the alleged contravention of Rule 19 of the Central Excise Rules.

4. Compliance with Notification Conditions: After considering submissions from both parties, the tribunal found that while the goods procured under CT-I certificates were indeed exported by the appellant, they were not exported in the same condition as received from the manufacturer supplier. However, since there was no dispute regarding the export of goods and no procedural irregularities in their removal, the tribunal held that the appellant had complied with the conditions of the notification. The tribunal referenced previous judgments to support its decision, emphasizing the importance of factual export and compliance with notification conditions.

In conclusion, the tribunal set aside the impugned order, allowing the appeal and providing consequential relief to the appellant. The judgment highlighted the significance of complying with notification conditions for availing benefits and emphasized the importance of factual export in excise duty matters.