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2016 (8) TMI 939 - AT - Central ExciseRefund claim - Rule 5 of the Cenvat Credit Rules - availed cenvat credit of duty for payment of central excise duty on the finished products but are not in a position to utilize the same used in the manufacture of final products, which were cleared to a 100% EOU under CT-3 certificates - whether the clearances to 100% EOU (which is a deemed export) may be considered on par with export, which is export out of India - Held that - an identical issue has been considered by several benches of this Tribunal as also the Hon ble High Court of Gujarat. In the decision of the Hon ble Gujarat High Court in the case of CCE Vs. Shilpa Copper Wire Industries 2008 (2) TMI 93 - CESTAT AHMEDABAD , held that the clearances to 100% EOU be considered on par with physical export for which refund of un-utilised cenvat credit is allowable. An identical view has been taken by the Tribunal in Elcomponics Sales Pvt. Ltd. 2011 (10) TMI 196 - CESTAT, NEW DELHI . Therefore, in view of the same, the issue is no more res integra and stands decided in favour of the appellant. - Decided in favour of appellant
Issues:
Claim of refund under Rule 5 of the Cenvat Credit Rules for goods cleared to a 100% EOU under CT-3 certificates. Analysis: The appellant, a manufacturer of textile products, filed a refund claim under Rule 5 of the Cenvat Credit Rules, stating they couldn't utilize the cenvat credit of duty paid on inputs used in the final products cleared to a 100% EOU. The claim was disallowed as clearances to 100% EOU were deemed exports, not actual exports, as required for refund. The appellant argued that since goods cleared to 100% EOU were used in manufacturing exported goods, they should be considered exports. Cited case laws supported their argument. The appellant contended that the issue was no longer res integra based on previous judgments. The dispute revolved around whether clearances to 100% EOU could be equated with physical exports for the purpose of claiming a refund under Rule 5 of the Cenvat Credit Rules. The lower authorities denied the refund, emphasizing the need for actual exports. However, the appellant argued that clearances to 100% EOUs should be treated as exports. Previous judgments, including one by the Hon’ble Gujarat High Court, supported the appellant's stance, stating that clearances to 100% EOU should be considered on par with physical exports, allowing for a refund of unutilized cenvat credit. The Tribunal concurred with this view, citing various cases where similar decisions were made. The Tribunal, considering the legal precedents and settled position on the issue, ruled in favor of the appellant. They set aside the impugned order and allowed the appeal, stating that the provisions of Rule 5 of the Cenvat Credit Rules applied to supplies made to 100% EOUs without payment of duty, and the refund of accumulated cenvat credit for such supplies could not be denied. The judgment was pronounced on 9.8.2016.
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