2019 (2) TMI 555 - AT - Central Excise

Maintainability of appeal - Rebate claim - Rule 18 of Central Excise Rules, 2002 - Held that - The issue whether the appeal against the rebate claim came before this Tribunal in the case Venus International Vs. CCE 2013 (8) TMI 900 - CESTAT MUMBAI , where it was held that the appeal relates to rebate of excise duty and the order has been passed by the Commissioner of Central Excise (Appeals) and, therefore, such appeal is not maintainable before this Tribunal - the appeal is maintainable before this Tribunal as in this case the core issue for denial of rebate claim is that whether the appellant is entitled to claim Cenvat credit on the invoices issued by M/s SS Exports (one of the supplier of the goods). The case of the Revenue is that M/s SS Exports had no facility to manufacturer the goods in question, therefore, the invoices issued by M/s SS Exports are fake, consequently, on the said invoices, the appellant is not entitled to avail cenvat credit, consequently, rebate claim cannot be sanctioned to the appellant - Held that - It is a fact on record that on the strength of ARE-I, the appellant has received the goods on the strength of the invoices issued by the M/s SS Exports, therefore, the burden lies on the Revenue to establish the fact that from where the appellant procured the goods in question, if they are not procured by M/s SS Exports, in these circumstances, when the export of the said goods has not been disputed by the Revenue. Therefore, as revenue has failed to establish the fact that from where the goods in question has been procured by the appellant, if not procured by M/s SS Exports, the benefit of doubt goes in favour of the appellant, therefore, the appellant is entitled to take Cenvat credit on the strength of the invoices issued by M/s SS Exports of the goods in question, as appellant is entitled to Cenvat credit, therefore, the question of denial for rebate claim does not arise. Appeal allowed - decided in favor of appellant.

Summary

Issues:
- Maintainability of appeals against rejection of rebate claim under Rule 18 of Central Excise Rules, 2002 before the Appellate Tribunal.
- Entitlement of the appellant to claim Cenvat credit on invoices issued by a specific supplier for the goods procured for export.

Analysis:
- The judgment dealt with the maintainability of appeals against the rejection of rebate claims under Rule 18 of the Central Excise Rules, 2002 before the Appellate Tribunal. The Ld. AR raised a preliminary objection citing Section 35B of the Central Excise Act, 1944, stating that such appeals are not maintainable before the Tribunal. The Ld. Counsel for the appellant relied on a decision of the Hon'ble High Court of Bombay in a similar case to argue that the appeal is maintainable. The Tribunal referred to a previous order where it was held that appeals related to rebate of excise duty, like in the present case, are not within the jurisdiction of the Tribunal. However, the High Court admitted an appeal challenging the Tribunal's decision, questioning the Tribunal's jurisdiction under Section 35B of the Central Excise Act, 1944. The High Court allowed the appeal, setting aside the Tribunal's order and directing the Tribunal to decide the case on its merits.

- The second issue revolved around the entitlement of the appellant to claim Cenvat credit on invoices issued by a specific supplier for goods procured for export. The appellant, a merchant exporter, faced a denial of rebate claim due to allegations that the supplier had no manufacturing facility, rendering the invoices fake. The Revenue contended that the appellant was not entitled to avail Cenvat credit based on these invoices, leading to the rejection of the rebate claim. However, upon examination of the records, it was found that the supplier was a registered manufacturer, although investigations suggested otherwise. The Tribunal held that since the export of goods was not disputed, the burden lay on the Revenue to prove the source of the procured goods. As the Revenue failed to establish this, the benefit of doubt favored the appellant, allowing them to claim Cenvat credit on the invoices issued by the supplier. Consequently, the denial of the rebate claim was overturned, and the appeals filed by the appellant were allowed with consequential relief.