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2012 (9) TMI 171 - CGOVT - Central ExciseRevision applications - 100% EOU - cleared their goods on payment of duty through Cenvat Account with an intent to claim rebate of duty in respect of the said export consignment cleared in terms of Rule 18 of the Central Excise Rules, 2002 - they came to know that there was no provision for an EOU to claim rebate of duty under Rule 18 - refund claim - Applicants had cleared goods for export on payment of duty without availing benefit under Notification No. 24/2003-C.E. Held that - Government cannot retain the amount collected without authority - amount so paid by applicant is to be treated as voluntary deposit with department and same is to be returned the way it was initially paid - erroneously paid amount may be allowed to be recredited in their Cenvat Credit Account - order-in-appeal is modified to this extent
Issues Involved:
1. Eligibility of an EOU to claim rebate of duty paid on exported goods. 2. Interpretation of Notification No. 24/2003-C.E. regarding duty exemption for EOUs. 3. Reassessment of duty paid on exported goods by lower authorities. 4. Treatment of duty paid erroneously by the applicant. Issue-wise Detailed Analysis: 1. Eligibility of an EOU to Claim Rebate of Duty Paid on Exported Goods: The applicant, a 100% Export Oriented Unit (EOU), exported goods on payment of duty and subsequently claimed a rebate. The adjudicating authority rejected the rebate claim, stating that as an EOU, the applicant was not required to pay duty. The applicant argued that they should be entitled to a refund of the duty paid, citing various case laws to support their position. The government noted that the main issue was whether an EOU could export goods on payment of Central Excise Duty and claim a rebate. The government's stance was that the statutory provisions should be strictly adhered to, as supported by the Supreme Court's observations in M/s. I.T.C. Ltd. v. C.C.E. and M/s. Paper Products v. C.C.E. 2. Interpretation of Notification No. 24/2003-C.E. Regarding Duty Exemption for EOUs: Notification No. 24/2003-C.E. exempts all excisable goods produced or manufactured in an EOU from the whole of duty of excise. The notification is absolute and unconditional, meaning it does not require any conditions to be fulfilled for the exemption to apply. The only proviso is that the exemption does not apply to goods brought to any other place in India, indicating that the exemption is not available for goods cleared for home consumption. The government observed that this notification falls under Section 5A(1A) of the Central Excise Act, 1944, which mandates that if an exemption is granted absolutely, the manufacturer cannot pay duty on such goods. 3. Reassessment of Duty Paid on Exported Goods by Lower Authorities: The applicant contended that the lower authority had no power to reassess or evaluate the duty element paid at the time of clearance of exported goods, which had already been verified and allowed by the proper officer. They relied on Board Circular No. 510/06/2000-CX, which clarifies that the rebate sanctioning authority should only examine the admissibility of the rebate and not the correctness of the assessment. The applicant also cited the judgment in M/s. Priya Blue Industries Ltd. v. Commissioner of Customs (Preventive) to support their view. 4. Treatment of Duty Paid Erroneously by the Applicant: The government observed that the Commissioner (Appeals) had passed a detailed and judicious order addressing all the points raised by the applicant. The applicant relied on the decision of the Hon'ble High Court of Rajasthan in C.C.E. v. Suncity Alloys, which held that the government cannot retain amounts collected without authority. The government concluded that the amount paid by the applicant should be treated as a voluntary deposit and directed that the erroneously paid amount be recredited to the applicant's Cenvat Credit Account. The impugned order-in-appeal was modified to this extent. Conclusion: The revision application was disposed of with the direction that the erroneously paid amount be recredited to the applicant's Cenvat Credit Account, thereby modifying the impugned order-in-appeal.
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