2012 (10) TMI 545 - CGOVT - Central Excise

Rebate claim and drawback Held that - Rebate has been claimed along with duty Drawback and both cannot be sanctioned simultaneously - notices to show cause was adjudicated vide orders disallowing the rebate and the amount already sanctioned was to be recovered - applicant has already taken the benefit of drawback and the allowing rebate of duty would amount to double benefit. As such rebate claim cannot be allowed in these cases

Summary

Issues:
Claim of rebate and duty drawback simultaneously; Disallowance of rebate claims; Availment of Cenvat credit; Double benefit of rebate and drawback.

Analysis:
The case involved a revision application by M/s. Sabare International Ltd. against Orders-in-Appeal passed by the Commissioner of Customs & Central Excise. The applicant availed Cenvat credit on inputs used in manufacturing final products and claimed rebate under Rule 18 of the Central Excise Rules, 2002. The issue arose when the Assistant Commissioner disallowed the rebate claimed along with duty drawback, stating that both cannot be sanctioned simultaneously.

The applicant argued that they did not avail Cenvat credit on inputs used in manufacturing the final products, hence claiming full drawback. However, the Drawback Rules specified that drawback is to be denied when both Cenvat excise duty drawback and rebate of Customs and Central Excise duties are availed simultaneously. The applicant contended that they provided evidence of non-availment of Cenvat credit, but the authorities disagreed.

The Government observed that the applicant had indeed availed drawback of both Customs and Excise portions, contradicting the claim of not using Cenvat credit. The Government found that allowing both drawback and rebate would result in double benefit, which is impermissible. The applicant's plea to disallow drawback instead of rebate was rejected as they had already benefited from drawback.

Ultimately, the Government upheld the decision of the Appellate Authority, stating that no infirmity was found in the order. The revision application was deemed devoid of merit and rejected. The case highlighted the importance of compliance with rules regarding the simultaneous claiming of rebate and drawback to prevent double benefits and ensure fair treatment under the law.