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2014 (12) TMI 30 - CGOVT - Central ExciseDenial of rebate claim - Determination of value for calculating rebate - place of removal - inclusion of ocean freight and insurance incurred beyond the port - duty payable on the transaction value i.e. FOB value is rebateable under Rule 18 of Central Excise Rules, 2002 - Held that - From the perusal of above provisions it is clear that the place of removal may be factory/warehouse, a depot, premise of a consignment agent or any other place of removal from where the excisable goods are to be sold for delivery at place of removal. The meaning of word any other place read with definition of Sale , cannot be construed to have meaning of any place outside geographical limits of India. The reason of such conclusion is that as per Section 1 of Central Excise Act, 1944, the Act is applicable within the territorial jurisdiction of whole of India and the said transaction value deals with value of excisable goods produced/manufactured within this country. Government observes that once the place of removal is decided within the geographical limit of the country, it cannot be beyond the port of loading of the export goods. Under such circumstances, the place of removal is the port of export where sale takes place. Duty was paid on CIF value as admitted by applicant. The ocean freight and insurance incurred beyond the port, being place of removal in the case cannot be part of transaction value in terms of statutory provisions discussed above. Therefore, rebate of excess duty paid on said portion of value which was in excess of transaction value was rightly denied. Applicant has contended that if rebate is not allowed then the said amount may be allowed to be re-credited in the Cenvat credit account. Applicant is merchant-exporter and then re-credit of excess paid duty may be allowed in Cenvat credit account from where it was paid subject to compliance of provisions of Section 12B of Central Excise Act, 1944 - Decided partly in favour of assessee.
Issues:
- Rejection of part rebate claim by Deputy Commissioner of Central Excise - Appeal rejection by Commissioner (Appeals) - Revision application filed before Central Government Analysis: 1. The revision application was filed by M/s. Sumitomo Chemicals India Pvt. Ltd., a merchant exporter, against the rejection of a part rebate claim of Rs. 2,03,514 by the Deputy Commissioner of Central Excise. The rejection was based on the grounds that the duty paid on the FOB value was rebateable under Rule 18 of Central Excise Rules, 2002. 2. The applicant appealed before the Commissioner (Appeals) after being aggrieved by the rejection. However, the appeal was also rejected, leading the applicant to file a revision application under Section 35EE of the Central Excise Act, 1944 before the Central Government. 3. The applicant's grounds for the revision application included arguments that the duty was paid on the assessable value indicated in the ARE-1, not for the payment of excise duty, and that excess duty paid should be allowed as rebate based on Board Instructions and relevant rules. 4. The Government noted that the applicant filed rebate claims totaling Rs. 51,61,636 for duty paid on exported goods. The duty was paid on the CIF value, and the FOB value was determined as the transaction value, leading to the rejection of the part claim of Rs. 2,03,514 for excess duty paid. 5. The Government observed that the determination of the value of excisable goods involved various statutory provisions, including Section 4 of the Central Excise Act, 1944, which defines the transaction value based on the relationship between the assessee and the buyer, among other factors. 6. The Government further analyzed the concept of 'place of removal' as defined under Section 4(3)(c) of the Act, emphasizing that the place of removal must be within the geographical limits of India. The judgment in the case of CCE v. M/s. Bhagirth Textiles Ltd. supported the idea that duty is not to be paid on the CIF value. 7. The Government referred to Supreme Court judgments and CBEC Circulars to clarify the valuation of excisable goods and the determination of assessable value at the place of removal. The Circulars emphasized the transaction value under Section 4 of the Act and the eligibility for rebate of whole duty paid on excisable goods. 8. In conclusion, the Government noted that duty was paid on the CIF value, and the excess duty paid on the portion beyond the transaction value was rightly denied as rebate. The applicant's request for re-credit in the Cenvat credit account was considered, subject to compliance with the provisions of the Central Excise Act, 1944. 9. The revision application was disposed of based on the above analysis, and the order was issued accordingly.
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