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TMI Blog2012 (9) TMI 916X X X X Extracts X X X X X X X X Extracts X X X X ..... ning rebate claim of duty paid on exported goods and therefore the whole issue will have to be examined in the light of these instructions. The Notification No. 4/2006-C.E., dated 1-3-2006 as amended prescribed effective rate of duty @ 4%. As such it is not correct to say that it is a case of applicability of two notifications only and assessee, as exporter, is at liberty to choose any one notification which is beneficial to him. In this case, Notification No. 2/2008-C.E. providing for General Tariff Rate of duty and Notification No. 4/2006-C.E. providing for effective rate of duty have the effect of prescribing General Tariff rate and effective rate of duty respectively and therefore they have to be read together as stipulated in para 4.1 of Part-I of Chapter 8 of C.B.E. & C. Excise Manual. In fact, this confusion has arisen since in this case the General Tariff rate was reduced through Notification when special economic stimulus package was announced in 2008 by Government to deal with ongoing economic recession. There is no merit in the contentions of the respondent that they are eligible to claim rebate of duty paid @ 10% i.e. tariff rate ignoring the effective rate of 4%. - adj ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rs/exporters and filed their rebate claims in respect of goods exported from their factories situated at various places, under Notification No. 19/2004-C.E. (N.T.), dated 6-9-2004, issued under Rule 18 of Central Excise Rules, 2002, read with Section 11B of Central Excise Act, 1944. The assessee had exported P&P Medicaments falling under Chapter 30 and paid duty @ 10% in pursuance of Notification No. 2/2008-C.E., dated 1-3-2008, as amended. Similarly, the effective rate prescribed under another Notification No. 4/2006, dated 1-3-2006, as amended is @ 4%. The assessee was paying duty @ 4% on home consumption clearances in terms of Notification No. 4/2006, dated 1-3-2006, as amended and @ 10% on goods cleared for export as per Notification No. 2/2008-C.E., dated 1-3-2008, as amended. Thus, the assessee was simultaneously availing two notifications. The assessee should have paid duty @ 4% on export goods in a manner similar to the goods cleared for home consumption. Therefore, respective deficiency memos cum show cause notices were issued to the assessee for restricting the rebate amount to 4% (4.12%) i.e. the effective rate of duty and as to why the balance amount to the extent of 6% ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... different from the form or method in which the statutory duty is leviable and any exemption granted in relation to any excisable goods in the manner provided in this sub-section shall have effect subject to the condition that the duty of excise chargeable on such goods shall in no case exceed the statutory duty. In these cases general Tariff rate was provided vide Notification No. 2/2008, dated 1-3-2008 which was 10%. However, the effective rate of duty on the specific product was provided vide Notification No. 4/2006, dated 1-3-2006, as amended, which was 4%. Hence, the assessee cannot pay more than this statutory duty. Any duty paid more than the specified statutory duty will be treated as deposit with the Government. 4.3 The exemption notification issued under sub-section (I) of Section 5A of the Central Excise Act, 1944, exempting the goods either wholly or at such rate expressed in that notification are issued in the public interest and in fiscal law public interest is of prime importance than the private interest of an individual. Therefore, the notification exempting the goods at a rate expressed in that notification are binding on the assessee. To avoid this anomaly, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... fications in the Central Excise is not a new matter and similar situations aroused earlier also. In such situation the assessee has option to choose between the two notifications which are more beneficial to them. This issue is settled by the Apex Court in the following cases : • CCE, Baroda v. Indian Petro Chemicals reported in 1997 (92) E.L.T. 13 (S.C.) • HCL Ltd. v. Coll. Cus, New Delhi reported in 2001 (130 E.L.T. 405 (S.C.) • CC, New Delhi v. Parasrampuria Synthetics Ltd. reported in 2001 (133) E.L.T. 9 (S.C.) Wherein the Hon'ble Supreme Court has held that when two notifications co-exist simultaneously then the assessee has the option to choose any one of the notification beneficial to them. Therefore, the applicant can avail any one notification which is more beneficial to them for their total clearances including export. The applicant being fully aware of the two notifications having different rate of duty has after careful thought opted to pay duty @ 4% ad valorem on goods cleared for home consumption as mentioned by the adjudicating authority. Therefore, the applicant has to clear the export goods also @ 4%. If the applicants intend to shift to another ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... omandal Prints & Chemicals v. CCE, (d) 1989 (44) E.L.T. 500 (T) - Dunbar Mills Ltd. v. CCE, (e) 1985 (22) E.L.T. 574 (T) - Calico Mills v. CCE, (f) 2009 (242) E.L.T. 168 - Coca-cola Ltd. v. CCE, (g) 2007 (209) E.L.T. 321 (S.C.) - Share Medical Care v. UOI, (h) 1999 (108) E.L.T. 213 - CCE v. Cosmos Engineers, (i) 2003 (160) E.L.T. 1150 - CCE v. Thermopack Industries, (j) 1996 (83) E.L.T. 123 (T) - Gothi Plastic Industries v. CCE. 5.4 Notification No. 4/2006 & Notification No. 2/2008 co-exist in the books of law and are not mutually exclusive. (i) It is an undisputed fact that both the notifications under consideration are in existence simultaneously. Both the aforesaid notifications do not have any provisions excluding the other. In other words, Sr. No. 62C of Notification No. 4/2006 does not have any provision stating that the said notification has an over-riding effect over Notification No. 2/2008-C.E., dated 1-3-2008 and similarly, vice versa. Both the notifications have been issued under Section 5A of the Central Excise Act, 1944. (ii) In view of the settled legal position as explained supra, they had the option to avail any of the notification. The department cannot for ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ned portion of the order-in-original is liable to be set aside. It is well settled that there is no estoppel in taxation. Hence, the fact that the applicants were availing Notification No. 4/2006-C.E., dated 1-3-2006 in past is irrelevant for the present dispute. 6. Personal hearing was scheduled in this case on 27-8-2012. Shri Prashant M. Mhatre, Excise Executive appeared for personal hearing on behalf of respondent who after explaining factual details reiterated the submissions made in the written reply dated 24-8-2012 discussed in para 5 above. Nobody attended personal hearing from applicant side. 7. Government has carefully gone through the relevant case records and perused the impugned orders-in-original and orders-in-appeal. 8. Government notes that these revision applications are filed by the applicant Commissioner having a similar issue involved in all these revision applications. So, these are taken up together for decision by this common order. 9. On perusal of records, it is observed that respondent as manufacturer exporter has cleared export goods on payment of duty @ 10% in terms of Notification No. 2/2008-C.E., dated 1-3-2008 as amended, wherea ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... same time the Notification No. 4/2006-C.E., dated 1-3-2006 providing for effective rate of duty @ 4% was amended vide Notification No. 4/2008-C.E., dated 1-3-2008 by inserting Sr. Nos. 62A, 62B, 62C, 62D & 62E for CETH 3001, 3003, 3004, 3005 & 3006 (except 3006.60 & 3006.92) prescribing effective rate of duty @ 8%. Even in Joint Secretary (TRU) D.O. Letter No. 334/1/2008-TRU, dated 29-2-2008, it was clearly stated that the excise duty on drugs and pharmaceutical products falling under Central Excise Tariff Headings (CETH) Nos. 3001, 3003, 3004, 3005 & 3006 (except 3006.60 and 3006.92) has been reduced from 16% to 8% and thus general effective rate for all goods of Chapter 30 is now 8%. Thereafter, said Notification No. 4/2006-C.E. was amended vide Notification No. 58/2008-C.E., dated 7-12-2008 whereunder effective rate of duty was reduced to 4%. 10.2 The Joint Secretary (TRU) C.B.E. & C. in his D.O. Letter DOF No. 334/1/2008-TRU, dated 29-2-2008 explained the changes made in excise and customs duties through Finance Bill, 2008 introduced in Lok Sabha on 29-2-2008. In paras 1, 2 & 3, he informed as under :- "1. Central Excise 2. General Cenvat Rate : (Notification ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... onsumption. The classification and rate of duty should be in terms of Central Excise Tariff Act, 1985 read with any exemption notification and/or Central Excise Rules, 2002. The value shall be the "transaction value" and should conform to Section 4 or Section 4A, as the case may be, of the Central Excise Act, 1944. It is clarified that this value may be less than, equal to or more than the FOB value indicated by the exporter on the Shipping Bill." The plain reading of said para, reveals that the export goods shall be assessed to duty in the same manner as the goods cleared for home consumption are assessed. Further the classification and rate of duty should be as stated in schedule of Central Excise Tariff Act, 1985 read with any exemption notification and/or Central Excise Rules, 2002. This C.B.E. & C. Instructions clearly stipulate that applicable effective rate of duty will be as per the exemption notification. The said instruction is issued specifically with respect to sanctioning rebate claim of duty paid on exported goods and therefore the whole issue will have to be examined in the light of these instructions. As explained in Para 9.1 above, Notification No. 2/2008-C.E., da ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... duty beneficial to assessee have to be extended. The said letter has not allowed payment of duty under both notifications. The manufacturer exporter as assessee could have opted for one notification for all clearance even if it is considered as case of applicability of two notifications. 10.5 Government notes that departmental authorities are bound by C.B.E. & C. Circulars/Instructions and they have to comply with the same. Hon'ble Supreme Court has held in the case Paper Products Ltd. v. CCE - 1999 (112) E.L.T. 765 (S.C.) that circulars issued by C.B.E. & C. are binding on departmental authorities, they cannot take a contrary stand and department cannot repudiate a circular issued by Board on the basis that it was inconsistent with the statutory provision. Hon'ble Apex Court has further held that department's actions have to be consistent with the circulars, consistency and discipline are of far greater importance than winning or losing court proceedings. In view of said principles laid down by Hon'ble Supreme Court, Government upholds the applicability of above said C.B.E. & C. Instructions in this case. 10.6 The respondents as well as Commissioner (Appeals) have reli ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y leading to arise of different question of law. 10.7 Government further notes that following case laws lend support to the view that rebate is to be allowed of the duty paid at effective rate prescribed in the notification and the excess paid amount as duty from the Cenvat credit is to be refunded in the Cenvat credit account. 10.7.1 Hon'ble Supreme Court has held in the case of CCE v. Parle Exports - 1988 (38) E.L.T. 741 (S.C.) that when a notification is issued in accordance with power conferred by statute, it has statutory force and validity and therefore exemption under notification is, as if it were contained in the Act itself. Apex Court has clearly observed that any exemption notification specifying effective rate has to be complied with. In this regard, Hon'ble CESTAT Ahmedabad Bench in its judgment in the case of Mahindra Chemicals v. CCE, Ahmedabad - 2007 (208) E.L.T. 505 (T.-Ahd.) while relying on above said Apex Court judgment has held that exemption notification has to be construed as if this rate was prescribed by statute and when the legislature has decided to exempt certain goods by notification, the exemption cannot be negated by an assessee by opting ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ue concept, cannot be strictly applied after 1-7-2000. As per para 3(b)(ii) of Notification No. 19/2004-C.E. (N.T.), dated 6-9-2004, the rebate sanctioning authority has to satisfy himself that rebate claim is in order before sanctioning the same. If the claim is in order he shall sanction the rebate either in whole or in part. The said para 3(b)(ii) is reproduced below :- "3(b) Presentation of claim for rebate to Central Excise :- (i) ……………………………. (ii) The Assistant Commissioner of Central Excise or the Deputy Commissioner of Central Excise having jurisdiction over the factory of manufacture or warehouse or, as the case may be, Maritime Commissioner of Central Excise shall compare the duplicate copy of application received from the officer of customs with the original copy received from the exporter and with the triplicate copy received from the Central Excise Officer and if satisfied that the claim is in order, he shall sanction the rebate either in whole or in part." The said provisions of this notification clearly stipulate that after examining the rebate claim, the rebate sanctioning aut ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ication No. 4/2006-C.E., dated 1-3-2006. The amount of duty paid in excess of duty payable at effective rate of 4% as per Notification No. 4/2006-C.E. on the exported goods, is also rightly treated as voluntary deposit made by applicant with the Government. In such cases where duty is paid in excess of duty actually payable as held by Hon'ble Apex Court in the case discussed in para 10.7.2 and also held by Hon'ble High Court of Punjab and Haryana as discussed in para 10.7.3 above, the excess paid amount is to be returned/adjusted in Cenvat credit account of assessee. Moreover Government cannot retain the said amount paid without any authority of law. Therefore, the original authority has rightly allowed the re-credit of said excess paid amount of duty in their Cenvat credit account. In view of position discussed above, the impugned order-in-original is not legal and proper and therefore is not sustainable as per law.
15. Therefore, Government sets aside the impugned orders-in-appeal for not being legal and proper and restores the impugned orders-in-original.
16. These revision applications thus succeeds in terms of above.
17. So ordered. X X X X Extracts X X X X X X X X Extracts X X X X
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