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2015 (2) TMI 267 - AT - Central ExciseDenial of rebate claim - export of exempted goods - Prescribed procedure for export not followed - Notification no.41/2001-CE(NT) dated 26.06.2001 read with Notification No. 42/2001-CE (NT) dated 26.06.2001 - Held that - Appellant had manufactured stainless steel utensils from duty paid stainless steel flats. Stainless steel utensils, during the period of dispute, were fully exempt from duty and for this reason, the appellant were not registered with Central Excise Registration. Rule 18 of the Central Excise Rules provides for rebate of central excise duty paid on the materials used in manufacture or processing of the finished goods exported out of India subject to the conditions to be specified and procedure followed as notified by the Government. The Notification No.41/2001-CE (NT) dated 26.06.2001 issued under Rule 18 of the Central Excise Rules, 2001 prescribes the necessary conditions for the purpose of input duty ratio and also the procedure to be followed in this regard. - The Notification no.42/2001-CE dated 26.06.2001 prescribes the detailed procedure for export of the goods under claim for rebate. In this case, admittedly, neither the necessary declaration describing the export product and the materials to be used with input-output ratio was made to the jurisdictional Asstt./Dy. Commissioner and, therefore, the jurisdictional Central Excise Authorities had not opportunity to verify the input output ratio. Besides this, it is not possible to verify as to whether the appellant procured the inputs directly from a manufacturer or from a dealer registered. Even the clearance of the export consignments was admittedly, not under ARE-2 and therefore, there is no question of procedure as prescribed under Notification No.42/2001-CE being followed. As regards the appellant s plea that standard input-output ratio for stainless steel utensils prescribed in the Exim Policy could be adopted for the purpose of rebate under Rule 18 of the Rules, this plea cannot be accepted, as the condition for rebate as prescribed in the Notification no.41/2001-CE(NT) requires input-output ratio to be declared to the jurisdictional central excise authorities and its verification, which has not been done in this case. In fact, if the appellant s plea is accepted, the Notifications nos.41/2001-CE (NT) dated 26.06.2001 read with Notification no.42/2001-CE (NT) dated 26.06.2001 would become redundant, while the very purpose of this notification is to avoid administrative inconvenience and prevent the mis-use of this facility by the assessee. We, therefore, hold that the judgements of the Apex Court in the case of Indian Aluminium Company 1991 (9) TMI 162 - SUPREME COURT OF INDIA and Eagle Flask Industries Ltd. 2004 (9) TMI 102 - SUPREME COURT OF INDIA are squarely applicable to the facts of this case and as such, non-observance of the conditions prescribed in the notifications mentioned above, would result in denial of the rebate. - No infirmity in impugned order - Decided against assessee.
Issues:
Claim for rebate of central excise duty under Rule 18 of the Central Excise Rules, 2002 for exported stainless steel utensils. Analysis: During the period of dispute, the appellant manufactured stainless steel utensils which were fully exempt from duty. The appellant exported these utensils under a claim for rebate under Rule 18 of the Central Excise Rules, 2002. The rebate claims were rejected by the Asstt. Commissioner citing non-compliance with prescribed conditions and procedures. The Commissioner (Appeals) upheld the rejection, leading to the current appeal. The appellant argued that they followed all procedures except for declaring the input-output ratio, which should not result in rejection. They cited judgments supporting substantive benefits over procedural infractions. The Departmental Representative defended the rejection, emphasizing the importance of complying with the prescribed conditions for rebate eligibility. The Tribunal analyzed the relevant notifications and conditions for claiming rebate under Rule 18. It highlighted the necessity of filing declarations, verifying input-output ratios, procuring inputs directly from registered sources, and clearing export consignments under specified procedures. The appellant failed to meet these requirements, leading to non-observance of substantive conditions meant to prevent misuse of the rebate facility. The Tribunal rejected the appellant's argument to adopt standard input-output ratios from the Exim Policy, emphasizing the importance of complying with the specific conditions outlined in the notifications. Non-compliance with these conditions, especially regarding declaration and verification of input-output ratios, led to the denial of the rebate. Citing relevant Apex Court judgments, the Tribunal upheld the rejection of the rebate claims, dismissing the appeal. In conclusion, the Tribunal found no infirmity in the impugned order due to the appellant's failure to adhere to the prescribed conditions and procedures for claiming the rebate. The appeal was dismissed, affirming the rejection of the rebate claims.
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