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2012 (9) TMI 710 - CGOVT - CustomsRebate claim - manufacture of electrical goods, cables & MCCB - They exported finished goods - department observed that the appellants had taken DFIA Licence alleged that they availed/claimed the said rebate of duty by availing the double benefit i.e. availment of Cenvat credit of duty paid on inputs Held that - No restriction in the Notification No. 40/2006-Cus., on claiming rebate of duty paid on exported goods and availment of Cenvat credit. Since the applicant has complied with all the provisions and procedure as laid down in Rule 18 of Central Excise Rules, 2002 and Notification No. 19/2004-C.E. (N.T.), dated 6-9-2004 - no dispute about the export of duty paid goods, the rebate claim is admissible to the respondent
Issues Involved:
1. Eligibility of rebate claim under Notification No. 19/2004-C.E. (N.T.), dated 6-9-2004 when availing benefits under the DFIA Scheme. 2. Whether the simultaneous availing of Cenvat credit and DFIA Scheme benefits constitutes a double benefit. 3. Impact of retrospective amendments to Notification No. 40/2006-Cus., dated 1-5-2006 on rebate claims. Detailed Analysis: Issue 1: Eligibility of Rebate Claim under Notification No. 19/2004-C.E. (N.T.), dated 6-9-2004 The Commissioner (Appeals) allowed the rebate claim on the basis that Notification No. 19/2004-C.E. (N.T.), dated 6-9-2004 did not restrict rebate claims for entities working under the DFIA Scheme. The Department argued that the Commissioner (Appeals) failed to consider the overall scheme and the manner of duty payment on exported goods under the DFIA Scheme. However, the Government observed that the DFIA Scheme is governed by the Foreign Trade Policy (2004-09) and that the relevant customs notification (No. 40/2006-Cus., dated 1-5-2006) did not restrict rebate claims if the inputs were not procured against the DFIA authorization. Issue 2: Simultaneous Availing of Cenvat Credit and DFIA Scheme Benefits The Department contended that the respondents availed double benefits by claiming Cenvat credit on inputs and also availing exemption benefits under the DFIA Scheme. However, the respondents clarified that they did not procure inputs on payment of duty against the DFIA authorization, and thus, were eligible to take Cenvat credit. The Government noted that the original customs notification (No. 40/2006-Cus., dated 1-5-2006) and the Foreign Trade Policy did not allow Cenvat credit if materials were procured against the authorization. Since the respondents did not procure materials against the authorization, they were eligible for Cenvat credit. Issue 3: Impact of Retrospective Amendments to Notification No. 40/2006-Cus., dated 1-5-2006 The Government observed that Notification No. 40/2006-Cus., dated 1-5-2006 was amended by Notification No. 17/2009-Cus., dated 19-2-2009, removing the restriction on availing Cenvat credit for materials imported/procured against the authorization. Furthermore, the Finance (No. 2) Act, 2009 retrospectively amended the notification to allow rebate on locally procured materials used in the manufacture of exported goods under the DFIA Scheme. This retrospective amendment implied that the original notification never prohibited such rebates, thus supporting the respondents' claim. Conclusion: The Government concluded that there was no restriction in Notification No. 40/2006-Cus., dated 1-5-2006 on claiming rebate of duty paid on exported goods while availing Cenvat credit. The respondents complied with all provisions and procedures under Rule 18 of the Central Excise Rules, 2002 and Notification No. 19/2004-C.E. (N.T.), dated 6-9-2004. The Department failed to provide evidence of double benefits. Therefore, the Government upheld the Order-in-Appeal and rejected the revision application, finding it devoid of merit.
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