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2016 (10) TMI 37 - AT - Central Excise100% EOU - Refund claim - Rule 5 of Cenvat Credit Rules, 2004 - export of goods under bond - goods viz., Photovoltaic Solar modules, panels and cells manufactured were exempted under Notification No. 06/2006-CE dated 01-03-2006 as amended by Notification No. 12/2012-CE dated 17-03-2012 - Held that - in view of the finding by the Original Authority that at the time of clearance of the goods in domestic tariff area duty foregone on the inputs equal in amount to that leviable on inputs used in the manufacture of such goods cleared in DTA is payable at the time of clearance of said goods. Therefore it cannot be held that the goods manufactured by the appellants are exempted when they are cleared in domestic tariff area. Therefore, we hold that they were entitled to avail the Cenvat credit and since the Cenvat credit is also not recovered under Rule 14 of Cenvat Credit Rules and is available in balance in the books of accounts the same is admissible to be refunded under Rule 5 of Cenvat Credit Rules, 2004. - Decided in favour of appellant
Issues:
Challenge to Order-in-Appeal rejecting refund claim under Rule 5 of Cenvat Credit Rules, 2004. Analysis: The appellant, a 100% export-oriented unit manufacturing Photovoltaic Solar modules, panels, and cells, filed a refund claim of ?2,66,28,814 for the period from July 2012 to December 2012 under Rule 5 of the Cenvat Credit Rules, 2004. The claim was initially rejected by the Assistant Commissioner, leading to an appeal before the Commissioner (Appeals), Noida. The matter was remanded back for fresh adjudication, where the Original Authority rejected the claim citing various provisions and notifications. The appellant further appealed, arguing that as they exported goods under bond, Rule 6(6) exempted them from Rule 6(1) of the Cenvat Credit Rules. However, the Commissioner (Appeals) upheld the rejection, stating that the goods were wholly exempt from Excise duty and thus not eligible for Cenvat credit. The appellant then appealed to the CESTAT Allahabad, contending that the goods were exported under bond, making Rule 6(1) inapplicable to them. They relied on legal precedents to support their claim. The CESTAT, after considering the arguments, found that duty foregone on inputs used in the manufacture of goods cleared in the domestic tariff area was payable, indicating that the goods were not exempt when cleared domestically. Therefore, the CESTAT held that the appellant was entitled to avail Cenvat credit, especially since the credit was not recovered under Rule 14 of the Cenvat Credit Rules. The Tribunal directed the Original Authority to refund the amount claimed within 60 days, allowing the appeal and disposing of the miscellaneous application. This judgment highlights the importance of understanding the intricacies of Cenvat credit rules, especially in cases involving export-oriented units and refund claims under Rule 5. It underscores the significance of legal arguments supported by relevant provisions and precedents in challenging and overturning decisions related to tax refunds in excise and customs matters.
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