2016 (7) TMI 301 - CGOVT - Central Excise

Rebate claim of duty - export of goods under Rule 18 of Central Excise Rules, 2002 - claim rejected on the ground that the applicant have not submitted documentary evidence/records to establish the actual receipt of inputs and its utilization in the manufacture of the finish goods exported under A.R.E-2 - Held that - On perusal of sample copies of documents submitted by the applicant, Government observes that invoices raised by M/S. Janta Glass Ltd, indicates name of M/S. Jai Glass works as dealer and M/S. Great India Industries and Pharmaceutical Ltd. (the applicant) as consignee. Further the invoice raised by M/S. Jai Glass works in the name of applicant also tallies with respect to quantity, no of packages, Truck No. L.R. No., Description etc. Under such circumstances, mere reliance on stock Register in isolation cannot be a basis of reaching to a conclusion that applicant failed to prove that duty paid inputs have been used in manufacture of final product. As such, the issue needs to be remined in light of all relevant documents to ascertain use of duty paid inputs in manufacturing of final exported products. The original authority is required to carry out the said verification on the basis of original documents and arrive at a decision as to whether the impugned inputs were received and utilized in the manufacture of the impugned export goods or not. Government sets aside impugned Order-in Original and remands the case back to original authority to decide the same afresh in view of above observation. Sufficient opportunity of hearing be afforded to concerned parties. - Decided in favor of applicant.

Issues involved:
1. Rejection of rebate claim by the original authority.
2. Rejection of rebate claim by the appellate authority.
3. Delay in processing the rebate claim.
4. Discrepancy in stock register entries.
5. Wastage during the manufacturing process.
6. Interest on the rebate claim.

Analysis:
1. The original authority rejected a part of the rebate claim amounting to Rs. 41,316 on the grounds that the applicant failed to establish the correlation between the actual receipt of inputs and their utilization in the manufacture of the final product. The appellate authority upheld this decision based on discrepancies in the stock register entry regarding the source of bottles received. The applicant argued that the verification should have considered relevant invoices showing the correct source. The government observed that reliance solely on the stock register was insufficient and remanded the case for a thorough verification based on original documents to determine the use of duty-paid inputs in the manufacturing process.

2. The issue of wastage during the manufacturing process was addressed in a previous revision order involving the same applicant. The government decided to remand this case back to the original authority to consider the observations made in the previous order and decide on the wastage issue accordingly.

3. The applicant raised concerns about delays in processing the rebate claim, stating that there was no intentional delay on their part. The government noted the timeline of events and acknowledged the delays caused by the authority in initiating the process. However, the issue of delay was not a determining factor in the decision to remand the case.

4. Regarding the interest on the rebate claim, the government highlighted that interest is supplementary to the admissibility of the rebate claim and should be decided based on the final decision regarding the claim in the remand proceedings.

5. In conclusion, the government set aside the impugned Order-in-Original and remanded the case back to the original authority for a fresh decision in light of the observations made. Both parties were to be given sufficient opportunity for a hearing during the process. The revision application was disposed of accordingly.

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