2017 (3) TMI 1277 - HC - Customs

100% EOU - CENVAT credit - input service - deemed export - Whether CENVAT credit is available in respect of input service used in the manufacturing of exported goods when such goods are exported to another 100% EOU even if there is no any physical export? - Held that - the clearances made by one 100% EOU to another 100% EOU which are deemed exports are to be treated as physical exports for the purpose of entitling refund of unutilized Cenvat credit contemplated under the provisions of Rule 5 of the CCR, 2004 - credit allowed - appeal dismissed - decided against Revenue.

Summary

Issues:
Whether CENVAT credit is available for input services used in manufacturing goods for export to a 100% EOU without physical export?

Analysis:

1. The appellant-Revenue appealed against a Tribunal order allowing appeals related to CENVAT credit availability for input services used in manufacturing goods for export to a 100% EOU without physical export.

2. The main issue raised was whether CENVAT credit is admissible for input services used in manufacturing goods for export to a 100% EOU without physical export. The Tribunal allowed the appeals based on the nexus of input services to the appellant's business activities.

3. The High Court of Gujarat's decision in a similar case supported the admissibility of CENVAT credit for deemed exports to a 100% EOU. The court referenced previous judgments to establish the legal position and dismissed the Revenue's appeal.

4. The High Court noted that the Revenue's appeal against the Gujarat High Court's decision was dismissed by the Apex Court, reinforcing the settled legal position on the admissibility of CENVAT credit for deemed exports to a 100% EOU.

5. Considering the legal precedents and the dismissal of the Revenue's appeal by the Apex Court, the High Court concluded that no substantial question of law arose for consideration. Therefore, the present appeals were dismissed based on the established legal position.