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TMI Blog2024 (2) TMI 249X X X X Extracts X X X X X X X X Extracts X X X X ..... by the adjudicating authority in violation of principles of natural justice. Even though the appellant had put forward this plea of violation of natural justice before the Commissioner (Appeals) the same was not considered and he has upheld the rejection of refund claim. Rejection of refund on the ground that the appellant has not furnished A.R.E-1 documents to establish that the goods have been exported - HELD THAT:- The appellant has produced the shipping bill, packing list, invoices as well as bank realization certificates. All these documents would show that the goods have been exported. Notification No.42/2001 provides for conditions in para-1 and procedures in para-2. The conditions in para-1 does not stipulate for submitting A.R.E-1 document at the time of export. However, in para-2 which lays down the procedure for export without payment of duty, it is stated that the exporter shall present the goods along with four copies of application in the Form A.R.E-1. Thus it can be inferred that the requirements to submit ARE-1 is not a condition but only a procedure - It is not the case of department that the goods have been exported without their approval or without issuing L ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... utilized cenvat credit for different periods in terms of Notification No.27/2012-CE (NT) dt. 18.06.2012 read with Rule 5 of Cenvat Credit Rules, 2004. After verification of the refund claims, it was noticed by the department that the appellant had not submitted copies of Customs certified A.R.E-1 in regard to the exports made by them. A letter dt. 27.11.2015 was issued to the appellant requesting to submit copies of A.R.E-1. The appellant vide letter dt. 10.12.2015 replied that EOUs are not required to follow the procedure detailed under Notification No.42/2001-CE (NT) dt. 26.06.2001 as EOUs export goods under B-17 Bond; that this is further elaborated by the Public Notice No.10/2001 dt. 17.10.2001 issued by the Bangalore Customs in this regard. This public notice has clarified at para-50 the procedure for export in relation to export of goods by an EOU. The public notice does not mandate to file A.R.E.-1 for export of the goods by EOU. It was also submitted by the appellant that other relevant documents for export of goods were submitted as evidence for the export made by them. The appellant had submitted the pink colour shipping bill along with refund claims which would be suffic ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... der B-17 Bond. However, the adjudicating authority rejected the refund not only for the reason that ARE-1 copies were not furnished, but also stating that there is mismatch with the address in the export invoices and shipping bills. It is submitted by the learned consultant that appellant was neither issued a SCN nor given a personal hearing and the order passed by the refund sanctioning authority is an exparte order. Though the appellant put forward the said plea before the Commissioner (Appeals), the same was not considered at all. Ld. consultant asserted that department cannot reject a refund claim without issuing a show cause notice and without informing the appellant as to the grounds on which the refund claim is proposed to be rejected. 5. On merits of the case, the learned consultant submitted that the main ground on which the refund claim has been rejected is that the appellant has not submitted the A.R.E.1s in respect of exports. Ld. Consultant adverted to Notification No.42/2001-CE (NT) dt. 26.06.2001 to argue that the said notification lays down conditions and procedures to be followed in the case of export without payment of duty. Under the head Procedure in sub-pa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... procedural changes in the case of EOU schemes. In para-8, it has been stated that EOUs exporting the goods under self-sealing and self-certification procedure shall submit a copy of such shipping bill along with invoices and packing list to the jurisdictional Customs / Excise Officer within 24 hours of removal of goods. 7. The Ld. Consultant asserted that the Board has clarified that the EOUs can export without A.R.E-1 when adopting the self-sealing and self-certification procedure. Although the appellant had explained these procedures adopted by them and the relevant notification and circular to the adjudicating authority, these contentions were not considered or accepted. 7.1 It is submitted by the Ld. consultant that the Tribunal in the case of Bramhos Aero Space Pvt. Ltd. Vs CC, C.Ex ST Hyderabad 2016 (342) ELT 127 (Tri.-Hyd.) had occasion to consider the issue as to the non-production of A.R.E-1 and the rejection of the refund on this ground. Ld. Consultant argued that the Tribunal in the said decision observed that it was only a procedural error and the refund cannot be rejected on such procedural infractions. The decision in the case of Mangalore Chemicals Ltd. re ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... re furnished before the jurisdictional Inspector / Superintendent who has verified the entire documents and then issued Let Export Order. The department then cannot deny the refund of unutilized credit of inputs / input services used to manufacture goods exported by alleging that the address in export invoices do not reconcile with the shipping bills. The name and other details are entirely same. Before removal of the goods from their EOU in Hosur, the appellant raised invoices on the foreign customers showing their Bangalore Corporate office as the address of the exporter. This is done for accounting purposes in SAP system. However, it is clearly declared in the invoice that EOU in Hosur is the manufacturer and exporter of the goods. Further, at the time of removal of goods, an ex-bond shipping bill (also referred as Pink Shipping Bill) is prepared which contains all information such as exporter (EOU), the customer details, the description and quantity of goods exported, the details of self-sealing self-certification, invoice details etc. The clearance of each consignment of goods rom factory is informed to the jurisdictional Central Excise officer about the export along with al ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ural justice. 11. It is submitted by the learned consultant that in the reply to the SCN, the appellant had explained that for each export shipment they had given the intimation to the range authority and submitted the Customs documents in time for the goods which have been exported from Hosur to abroad. The documents in the nature of shipping bills, bank realization statement, invoices, Form JJ are sufficient to evidence the export of goods. The allegation that the appellant has not complied with the conditions laid down in Notification 42/2001-CE (NT) dt. 26.06.2001 is legally and factually erroneous. It is prayed that the demand, interest and penalties may be set aside. Ld. counsel prayed that the appeals may be allowed. 12. Ld. A.R Sri M. Selvakumar appeared and argued for the department. It is submitted that the appellant has not furnished the required document to evidence the proof of export of goods. The Department had informed the appellant vide letter dt. 27.11.2015 to furnish the A.R.E-1 duly certified by the Customs authorities. However, the appellant chose to issue a reply dt. 10.12.2015 contending that EOUs are not required to follow the procedure under Notificat ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... been rejected is that the appellant has not furnished A.R.E-1 documents to establish that the goods have been exported. The appellant has produced the shipping bill, packing list, invoices as well as bank realization certificates. All these documents would show that the goods have been exported. Notification No.42/2001 provides for conditions in para-1 and procedures in para-2. The conditions in para-1 does not stipulate for submitting A.R.E-1 document at the time of export. However, in para-2 which lays down the procedure for export without payment of duty, it is stated that the exporter shall present the goods along with four copies of application in the Form A.R.E-1. Thus it can be inferred that the requirements to submit ARE-1 is not a condition but only a procedure. Sub-para (iii) of para-4 lays down the procedure of despatch of goods by self-sealing and self-certification. The said para which is relevant for deciding the issue reads as under : iii. Despatch of goods by self-sealing and self-certification.- (a) Where the exporter desires self-sealing and self-certification for removal of goods from the factory, warehouse or any approved premises, the owner, the worki ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sufficient postage stamps to cover postal charges and shall present the documents, together with the package to which it refers, to the post master at the office of booking. 16. From the above, it can be seen that when exporter desires self-sealing and self certification for removal of goods, it is not necessary to submit the A.R.E-1 document and it would be sufficient if the owner, working partner, Managing Director or any authorized person certifies on all the copies of the application that the goods have been sealed in his presence. While following such procedure, the appellant is not required to file A.R.E-1. It is to be seen that such documents issued under self-certification are to be submitted to the Superintendent or Inspector of Central Excise having jurisdiction over the factory within 24 hours of the removal of the goods. Though the department alleges that the appellant has not complied with the procedure of submitting A.R.E.1 returns, they do not have a case that the appellant has not followed the self-sealing, self-certification procedure. It is not the case of department that the goods have been exported without their approval or without issuing Let Export Order. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed by EOUs hassle free export which reads as under : 8. Export under cover of Shipping Bill It has been brought to the notice of the Board that in certain Commissionerates where EOUs export goods under Shipping Bill procedure, a visit to the jurisdictional Customs office is required to get the Shipping Bill number. In order to simplify this procedure, the Board has decided that the unit can use Shipping Bill with running serial number beginning from the first day of the financial year in line with the procedure being followed with respect to export of goods under cover of A.R.E.1 as prescribed under Chapter 7 (Part-II) of the CBEC's Central Excise Manual. The serial number of the Shipping Bill shall be intimated in advance to the jurisdictional Superintendent of Customs/Central Excise. Furthermore, EOUs exporting goods under self-sealing and self-certification procedure, shall submit a copy of such Shipping Bill along with Invoice and packing list to the jurisdictional Customs/Central Excise officer within twenty four hours of removal of goods. For the current financial year, this facility can be availed from 1 July, 2006. 20. The above clarification issued by ..... X X X X Extracts X X X X X X X X Extracts X X X X
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