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TMI Blog2013 (5) TMI 735X X X X Extracts X X X X X X X X Extracts X X X X ..... credit of duty paid on capital goods on the clearances made for home consumption and not for the exports. The adjudicating authority as well as the Government, in our opinion, committed an error in interpreting such provision. The adjudicating authority, therefore, erred in holding that the petitioner erroneously paid duty on clearances for export which duty was otherwise exempt under the notification. In fact, the notification itself is clear in this respect and grants exemption from payment of clearances made for home consumption. - Revenue directed to grant rebate / refund - decided in favor of assessee. - Special Civil Application No. 4730 of 2004 - - - Dated:- 29-8-2012 - Akil Kureshi and Harsha Devani, JJ. Shri Dhaval Shah, for the Petitioner. Shri Harin P. Raval, Jitendra Malkan, Varun K. Patel and Gaurang H. Bhatt, Advocates, for the Respondent. JUDGMENT The petitioner has challenged an order dated 21-2-2002 passed by the adjudicating authority as confirmed by the appellate order dated 7-3-2003 and revisional order dated 29-12-2003. The petition arises in following factual background. 2. The petitioner is a partnership firm and is engaged in the b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lue of clearances which do not exceed Rs. 100 lakhs in the manner specified in the table provided in the notification. He, therefore, concluded that, Thus, I observe that restriction of cenvat utilization from capital goods is applicable for aggregate first clearance value less than Rs. 100 lakhs irrespective of mode of consumption i.e. home consumption or export. . 2.5 On such basis, the rebate claim of the petitioner was disallowed. The petitioner preferred appeal against such order before the appellate authority. Before the appellate authority, the petitioner contended that Notification No. 8/2001 did not apply to exports made and did not prohibit utilizing cenvat credit on capital goods for payment of duty of export products. In his order dated 7-3-2003, the appellate authority in fact accepted the petitioner s interpretation of Notification No. 8/2001 making following observations : On plain reading of Notification No. 8/2001, dated 1-3-2001, it is observed that said Notification allows exemption on specified goods cleared for home consumption only. The goods cleared for export either under bond or on payment of duty are not covered under the said Notification. Obviously ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ferred. 3. Counsel for the petitioner submitted that the authorities gravely erred in interpretation of the exemption Notification No. 8/2001. The petitioner had filed a rebate claim on the basis of the export made on which excise duty was paid. Exemption Notification No. 8/2001 would not debar any such rebate claim. Clause (iv) of para 2 was misinterpreted by the authorities and would have no application to the clearances for export. He submitted that the entire approach was erroneous. Rebate claim should have been allowed. 4. On the other hand, Mr. Varun Patel, learned counsel for the Department opposed the petition. He placed reliance on the impugned orders and in particular, the decision of the revisional authority. He submitted that clause (iv) of para 2 of Notification No. 8/2001 was correctly interpreted. 5. From the above, it can be seen that the central question to be decided in the present proceedings is the true interpretation of Notification No. 8/2001 and in particular, clause (iv) of para 2 thereof. Before trying to interpret such provision, we may reiterate the admitted facts. The petitioner is manufacturer clearing final product for home consumption as well as ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... not be entitled to utilize the credit of duty on capital goods, paid on such goods for payment of duty on the aforesaid clearances upto an aggregate of Rs. 100 lakhs. Here the words on the aforesaid clearances are crucial. The limitation on utilization of the cenvat credit on capital goods for payment of duty is on the aforesaid clearances . The reference to on the aforesaid clearances must be seen as a reference to the goods cleared for home consumption referred to in clause (iii), just preceding clause (iv) of which the limitation of non-utilization of cenvat credit on inputs used in manufacture of such specified goods is imposed. To put it differently, clause (iv) of para 2 thereof puts a restriction on the manufacturer utilizing credit of duty paid on capital goods on the clearances made for home consumption and not for the exports. The adjudicating authority as well as the Government, in our opinion, committed an error in interpreting such provision. The Government, in particular, put much stress on the words if any to interpret this paragraph and thereby, did not give any weightage to the important words on the aforesaid clearances which appear in the same paragraph ..... X X X X Extracts X X X X X X X X Extracts X X X X
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