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TMI Blog2013 (12) TMI 815X X X X Extracts X X X X X X X X Extracts X X X X ..... led against the impugned orders for which the lower authorities have held that the appellant herein is not eligible to avail Cenvat credit on the inputs which were consumed for the manufacture of exempted goods; Appeals Nos. E/1367/2010, E/549/2011, E/1003/2011, E/86 & 87/2012 and E/464/2012 are filed by the assess for rejection of refund claims in pursuant to Cenvat credit availed by them on the same inputs. 2. The relevant facts which arise for consideration are during the course of scrutiny of monthly returns filed by the assessee, it was observed that they had availed Cenvat credit of service tax in respect of input services which were utilised for manufacturing of final products that were cleared by availing exemption under Notificati ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hat the findings of both the authorities are inconsistent with the law settled by the Hon'ble High Court of Bombay in the case of Repro India Ltd. vs. Union of India [2009 (235) E.L.T. 614 (Bom.)], and the judgment of Hon'ble High Court of Himachal Pradesh in the case of Commissioner of Central Excise, Driswh Shoes Ltd. [2010 (254) E.L.T. 417 (H.P.)]. 4. Learned Authorised Representative on behalf of Revenue, on the other hand, submits that the appellant is not entitled to avail the benefit of service tax paid if the goods are exempted and he claims the exemption. It is his submission that the exemption claimed by the appellant under Notification No. 3/2004-C.E. dated 9.7.2004 prohibits availment of Cenvat credit of duty paid on inputs. It ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... at such refund claims and Cenvat credit cannot be denied by the departmental authorities. This our conclusion based upon the ratio of their lordships decision in the case of Drish Shoes Ltd. (supra). We would respectfully reproduce the view of their lordships in the said case : 7. We have heard the counsel for the parties and gone through the record and the relevant rules. 8. It is not in dispute that the respondent is engaged in the manufacture of finished leather and that it had exported manufactured leather as claimed by it. The only question is whether under the CENVAT Credit Rules of 2002 or 2004, it is entitled to the credit/refund of CENVAT paid on inputs, like chemicals etc. purchased by it, to convert raw leather into finished le ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ained in sub-rule (6) of Rule 6 of 2004 rules, applies both to exempted goods, as also goods subject to duty, because the term used in sub-rule (6) is excisable goods and not 'exempted goods', as was the case in Rules of 2002. 12. Reference has been made hereinabove to the Rules of 2002, as also 2004, because from the record, it cannot be made out which rules should be applicable. Rules of 2002 were applicable in respect of inputs or capital goods received in the factory after 1st day of March, 2002. They remained in force till the Rules of 2004 came into force. Rules of 2004 are applicable in respect of inputs received by the manufacturer after 10th day of September, 2004. Since finished leather was exported between August, 2004 and March ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ribunal has upheld the order of the Commissioner (Appeals). 16. The Scheme of CENVAT Credit Rules, 2002, as also 2004, reference to the relevant provisions of which has been made hereinabove, shows that CENVAT credit/refund is allowed on the inputs of all manufactured goods which are not exempt from duty, as is clear from a combined reading of Rule 3 and sub-rule (1) of Rule 6 of the CENVAT Credit Rules, 2002, as also the Rules of 2004, so as to avoid indirect double taxation on inputs. However, this rule is not absolute. It is subject to exception clause, contained in Rule 6(5) of the Rules of 2002 and 6(6) of the Rules of 2004, and one of the exceptions is in respect of excisable goods, which are cleared for export under bond in terms of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ule 6(6) of CENVAT Credit Rules, 2004, used in the manufacture of such goods, if the goods are exported. Question No. 1 is answered accordingly. 21. As regards question No. 2, it is clear from a bare reading of Rule 5 of CENVAT Credit Rules, 2004 that a manufacturer, who exports the final products which are exempt from duty, can claim refund of CENVAT. So, this question is also answered against the appellant. 22. View of the aforesaid answers to the questions of law, appeal is dismissed. It can be seen from the above reproduced ratio of the facts of that case and the facts in the case in hand are similar /identical hence we are of a considered view that the impugned orders, which reject the refund claims and as also demanding the Cenvat ..... X X X X Extracts X X X X X X X X Extracts X X X X
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