1994 (8) TMI 112 - AT - Central Excise

Summary

Issues:
- Appeal against Order-in-Appeal allowing refund under Rule 57H
- Dispute over refund claim for additional duty paid on imported components
- Claim rejection based on goods being exported through merchant exporters
- Interpretation of Rule 57F(3) regarding refund eligibility for manufacturers
- Examination of relevant case laws and provisions

Analysis:
1. The appeal before the Appellate Tribunal CEGAT, New Delhi involved a dispute regarding a refund claim under Rule 57H. The respondents had imported components for manufacturing sound recorders and reproducers, exported the final products, and sought a refund of additional duty paid on the imported components. The Collector of Central Excise (Appeals) had allowed the refund, but the Revenue appealed against this decision.

2. The Revenue contended that the refund was inadmissible as the goods were exported through merchant exporters, not directly by the manufacturers. The Asstt. Collector rejected the refund claim on this ground, stating that Rule 57F(3) only allowed refunds for manufacturers who directly export their goods.

3. The Appellate Tribunal examined Rule 57F(3) and the relevant proviso, which allows refunds to manufacturers if the final products are cleared for export under bond. The Tribunal noted that the rule does not explicitly require goods to be exported by the manufacturer under bond, only that the goods are exported. The fact of export was not disputed in this case.

4. The Tribunal emphasized that the practice of merchant exporters lifting goods from manufacturers' premises after executing necessary bonds was common. The mere involvement of merchant exporters in the export process did not negate the fact of export under the rules. The Tribunal distinguished a cited case under the DEEC scheme, stating that the facts of this case were different.

5. Referring to the Supreme Court's decision in a relevant case, the Tribunal highlighted the importance of interpreting tax statutes based on the words chosen by the legislature. The Tribunal concluded that there was no merit in the Revenue's appeal and upheld the Order-in-Appeal allowing the refund under Rule 57H.

6. In summary, the Appellate Tribunal CEGAT, New Delhi dismissed the Revenue's appeal, affirming the decision to grant the refund to the respondents for the additional duty paid on imported components used in the exported final products. The Tribunal clarified the eligibility criteria under Rule 57F(3) and emphasized the importance of the fact of export in determining refund entitlement for manufacturers, irrespective of the involvement of merchant exporters in the export process.