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TMI Blog2014 (1) TMI 968X X X X Extracts X X X X X X X X Extracts X X X X ..... rly, the appellant had also imported duty free input materials under Notification No. 94/2004-Cus., dated 10-9-2004 through Nhava Sheva Port against the following 2 Advance Authorisation for Annual Requirements issued by the Jt. DGFT, Bhopal : 1. No. 1110015795 dated 31-7-2007 2. No. 1110014558 dated 19-12-2006 3.3 As required under the Notification, at the time of clearance of the imported materials, the appellant had executed bonds with the jurisdictional Asstt. Commissioner/Dy. Commissioner of Customs binding itself to pay on demand an amount equal to the duty leviable, but for the exemption, on the imported materials in respect of which the conditions specified in the notification have not been complied with, together with interest at the rate of 15% per annum from the date of clearance of the said materials. 3.4 The said duty free input materials were used in the manufacture of resultant export products, namely, Partially Oriented Yarn (POY). The said export products were exported on payment of Central Excise duty. After the export, the appellant had availed of rebate of duty paid on the export products under Rule 1 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ent case. The expression "facility under rule 18..." appearing therein can only mean the facility of rebate of duty paid on the raw materials used in the manufacture of the finished goods cleared for export and not the facility of rebate of duty paid on the finished goods cleared for export. 4.3 The contention is that Rule 19(1) provides for the export of manufactured excisable goods without payment of duty. Rule 19(2) prescribes the procedure for obtaining raw materials without payment of duty, for use in the manufacture of goods which are ultimately exported. In other words, Rule 19(1) governs the clearance of final products for export without payment of duty (final product stage facility) and Rule 19(2) provides for clearance of raw materials without payment of duty (input stage facility) for use in the manufacture of final products which are exported. The expression "facility under Rule 18 or sub-rule (2) of Rule 19 of the Central Excise Rules, 2002 has not been availed" appearing in Condition No. (8) when read in an integrated manner. Expression employed is a conjoint expression. Facility under Rule 18 or Rule 19(2) have to read together. Reference to Rule 18 has to be i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he Central Excise Rules, 1944 has not been availed. 4.5 The contention is that Rule 12(1)(b) from 1-10-1994 and 191A (prior to 1-10-1994) of the above Rules, related to rebate of excise duty paid on the raw materials used in the manufacture of goods exported. Rule 13(1)(b) from 1-10-1994 or 191B (prior to 1-10-1994) of the Central Excise Rules, 1944, the raw materials for use in the manufacture of final product cleared for export could be obtained without payment of duty. 4.6 The contention is that all the other notifications issued under Customs Act, 1962 from time to time till now for granting exemption to materials imported under advance licence/advance authorization for use in the manufacture of export goods, did not stipulate that the rebate of duty paid on the goods exported should not have been availed. They all stipulated that the rebate of duty paid on the materials used in the manufacture of the goods exported for discharging export obligation under advance licence/advance authorization should not have been availed. Similarly, they stipulated input used for export product should not be procured under bond. Final product can be exported without payment of duty ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n of Condition No. 8 of Notification No. 94/2004-Cus., under annual advance authorization. The contention is that Condition No. (8) of Notification No. 94/2004-Cus., dated 10-9-2004 referred to facility under Rule 18, it only refers to the facility of rebate of duty paid on the raw materials for use in the manufacture of goods cleared for export. Correction of Notification No. 93/2004 is by corrigendum. This establishes that corrigendum dated 17-5-2005 is a correction of obvious slip. 4.11 The Condition No. (v) of Notification 93/2004-Cus., dated 10-9-2004 provides that facility under Rule 18 or sub-rule (2) of Rule 19 of the Central Excise Rules, 2002 has not been availed. The Condition No. (v) was corrected by corrigendum dated 17-5-2005 and provides for rebate of duty paid on materials used in the manufacture of resultant product. The underlined portion of the amended Condition No. (v) was added by the corrigendum. It is evidence corrigendum can be only for obvious omission or oversight. This shows that reference to Rule 18 always meant rebate of duty paid on materials used in the manufacture of resultant product. It is clear that by way of abundant caution the Condition N ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f the export of resultant product under the scheme of rebate of duty paid on the finished product exported will be violation of the Condition No. 8 of Notification No. 94/2004-Cus., whereas if the exporter had exported finished goods under bond while operating under annual advance authorization, it would not be violation of Condition No. 8 of Notification No. 94/2004-Cus. Such an interpretation of Condition No. 8 of Notification No. 94/2004-Cus., is discriminatory in nature and hence should be avoided as has been held by Hon'ble Supreme Court in the case of Hindustan Petroleum Corporation Ltd. - 1995 (77) E.L.T. 256. In support of their contention, they also placed reliance in the case of CCE v. Bhilwara Spinners Ltd. - 2011 (269) E.L.T. 384. 4.14 The contention is that the case of the department that Condition Nos. 9 and 10 of Notification No. 94/2004 are violated is merely consequential to the allegation in the Show Cause Notice that Condition No. 8 has been violated. For the various reasons submitted above, Condition No. 8 has not been violated by the appellants. Consequently, the allegation that Condition Nos. 9 and 10 of the Notification were violated is unsustainable in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ariff Act, 1975, while Notification No. 94/2004-Cus., exempts materials imported into India from payment of the whole of the duty of Customs and whole of the additional duty leviable thereon under Section 3 of the Customs Tariff Act, 1975. Therefore, the two notifications cannot be said to be similar. Moreover, it is well settled that while interpreting an exemption notification, one is not required to ascertain the intention of the Govt. by a comparison of expression used in two different notifications. In support they placed reliance on the decision of the Hon'ble Apex Court in the case of Coromondal Fertilizers Ltd. v. CC, Madras - 1986 (25) E.L.T. 861 (S.C.). 5.3 The contention is that so far as the contention of the appellant that the Rules 18 and 19 of the Central Excise Rules, 2002 are similar to Rules 12 and 13 of the erstwhile Central Excise Rules, 1944 under which benefit of rebate was available in respect of finished goods exported. In support, they have placed reliance on the Hindustan Petroleum Corporation Ltd. - 1995 (77) E.L.T. 256 (S.C.). It is submitted that Rules 12 and 13 are no longer in existence, therefore, they are not relevant for the present case. Con ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... by the Licensing Authority by exporting resultant products manufactured in India and in respect of which facility under Rule 18 or sub-rule (2) of Rule 19 of the Central Excise Rules, 2002 has not been availed. At the time of export, the full details of value, quantity, technical characteristics and other particulars of the resultant export product (hereinafter referred to as resultant product) shall be entered in Part E of Part 2 of the Schedule to this notification, of the said certificate by the proper officer." The condition envisages that by exporting resultant products manufactured in India and in respect of which facility under Rule 18 or sub-rule (2) of Rule 19 of the Central Excise Rules, 2002 has not been availed. In order to appreciate the issue in proper prospective Rules 18 and 19 are reproduced herein for convenience : "RULE 18. Rebate of duty. - Where any goods are exported, the Central Government may, by notification, grant rebate of duty paid on such excisable goods or duty paid on materials used in the manufacture or processing of such goods and the rebate shall be subject to such conditions or limitations, if any, and fulfilment of such procedure, as may b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s, 2002 has not been availed", from the said expression it is clear that the condition provides that facility has not been taken in respect of 'manufacture of resultant product' and not in respect of 'resultant product', per se. Therefore the bar under Rule 19(2) and Rule 18 and in respect of manufacture of resultant product have to be read in conjunction. The principle of ejusdem generis would be applicable in the case. The facility under Rule 19(2) signify inputs/raw material, which is applicable to inputs used in manufacture of resultant products and to inputs/material covered under Rule 18, as well. 6.2 It is pertinent to mention here that Notification 94/2004 has been issued in the context of import under advance licence for annual requirement or advance authorisation for annual requirement with actual user condition issued to Star Export Houses and Notification 93/2004 has been issued in the context of Import of Advance Licence/Advance Authorisation. The contention of the appellant is that Condition (v) of the Notification 93/2004 is similar to Condition (8) of Notification 94/2004 ibid. The Notification 93/2004 was amended with effect from 17-5-2005. To appreciate the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ition No. 8 of Notification No. 94/2004-Cus., he has held that the said Condition of the notification bars availing of the benefit of input stage rebate under Rule 18 and not the benefit of rebate of duty on the final products exported. We agree with the contention of the appellant that having any different interpretation would be discriminatory to the appellant as held by the Hon'ble Supreme Court in the case of Hindustan Petroleum Corporation Ltd. (supra) held as under : "15 ......... As per rule 13 exporter of excise goods on which duty had not been paid has also to follow the same procedure under Chapter IX as has to be followed for exports under Rule 12. Thus an exporter of excisable goods on which duty is not paid in the first instance but which are covered under the bond duly executed in favour of the revenue by the owner of the goods has also to follow the procedure of Rule 185 found in Chapter IX. All that Rule 13 therefore seeks to do is that it provides for the facility of deferred payment of excise duty and what will be the extent of duty ultimately payable on such goods covered by bond executed under Rule 13 will have to be determined independently of Rule 13 and ..... X X X X Extracts X X X X X X X X Extracts X X X X
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