2018 (8) TMI 1450 - CGOVT - Central Excise

Rebate claim - Rule 18 of the Central Excise Rules, 2002, read with N/N. 19/2004-C.E. (N.T.), dated 6-9-2004 - bulk drugs exported out of India for Excise duty paid by the Principal Manufacturer - denial of rebate on the ground that the goods were not directly exported from the factory of the manufacturer as stipulated in the Notification - rejection also on the ground of time limitation. Held that - It is absolutely clear that there is no dispute about the fact that the goods are not exported directly from the factory of the principal manufacturer or the factory of the applicant. Whereas, as per condition 2(a) of the Notification No. 19/2004, the rebate of the duty shall be available only if the goods are exported directly from the factory or warehouse except as otherwise permitted by the C.B.E. & C. by a general or special order - apart from the condition that the goods should be cleared directly from a factory or warehouse for the export thereof, the first and the foremost condition specified at Para 2(a) of N/N. 19/2004 is that the excisable goods must be exported after payment of duty and thus should be established that the goods exported are duty paid. The applicant has failed to establish that the duty paid goods cleared from the factory of the principal manufacturer have only been exported from their place in Gurugram - the rebate of duty in this case has not been rejected merely on the ground that the goods were not exported directly from the factory of the principal manufacturer, but it has also been rejected for the reason that the applicant has not been able to establish that the goods exported by them from a place other than the place of manufacture are the same which were originally cleared by the principal manufacturer from its factory on payment of central excise duty. Applicability of time limitation of one year to the rebate claims filed under Rule 18 and N/N. 19/2004 - The Government finds no legal force in this argument as for refunds and rebate of duty under Section 11B of the Central Excise Act is directly dealing statutory provision and it is clearly mandated therein that the application for refund of duty is to be filed with the Assistant/Deputy Commissioner of Central Excise before expiry of one year from the relevant date - by combined reading of both Section 11B of Central Excise Act, 1944 and Rule 18 of Central Excise Rules, 2002 it cannot be contemplated that Rule 18 is independent from Section 11B of the Act. Since the time limitation of 1 year is expressly specified in Section 11B and as per this section refund includes rebate of duty, the condition of filing rebate claim within 1 year is squarely applicable to the rebate of duty when dealt with by Assistant/Deputy Commissioner of a Division under Rule 18 - Thus Section 11B and Rule 18 are interlinked and Rule 18 is not independent from Section 11B. Revision application dismissed.

Summary

Issues:
1. Rebate claims rejection under Central Excise Rules, 2002.
2. Compliance with Notification No. 19/2004-C.E. (N.T.).
3. Duty payment verification for exported goods.
4. Time limitation applicability for rebate claims under Rule 18 and Notification No. 19/2004.

Analysis:
1. The case involved the rejection of rebate claims by the jurisdictional Assistant Commissioner of Central Excise, citing that the goods were not directly exported from the factory of the manufacturer as required by Notification No. 19/2004-C.E. (N.T.). Additionally, two rebate claims were rejected on grounds of being time-barred.

2. The applicant argued that they exported goods from their registered warehouse, meeting the conditions of Notification No. 19/2004. However, the Commissioner found that the exported goods' identity with duty-paid goods from the factory was not established. The applicant's reliance on Circular No. 294/10/97-CX was deemed misplaced, as the goods' direct linkage with duty payment was not proven.

3. The Commissioner noted that the applicant failed to demonstrate that the exported goods were the same as those cleared from the factory on payment of duty. The absence of departmental supervision or self-sealing procedures raised doubts about the exported goods' duty payment status, leading to the rejection of rebate claims.

4. Regarding the time limitation for rebate claims, the Government emphasized that Section 11B of the Central Excise Act mandates filing refund applications within one year from the relevant date. The interlinking of Section 11B and Rule 18 was highlighted, dismissing the applicant's argument that rebate claims could be filed without time constraints.

5. The rejection of rebate claims was upheld, considering the failure to establish the direct linkage between exported goods and duty-paid goods, as well as the applicability of time limitations under Section 11B and Rule 18. The decision was based on detailed analysis and legal precedents, ultimately leading to the dismissal of the revision applications.