TMI Blog2013 (7) TMI 155X X X X Extracts X X X X X X X X Extracts X X X X ..... envat credit on inputs, the applicant have automatically opted for exemption of duty under Notification No. 30/2004-C.E., dated 9-7-2004 in respect of export clearances. Held that:- Even if the applicant have stopped availing Cenvat credit on inputs and switched over to duty drawback claim facility in respect of export shipment in question, that does not automatically mean that the applicant has decided to work under Notification No. 30/2004-C.E., dated 9-7-2004 in respect of export clearances. Also, the conclusion drawn by the lower authorities is based on assumptions and presumptions. It is a settled law that any order passed by an authority on the basis of surmises and conjectures, is not maintainable under law. It is well settled proposition of law that claim of any exemption notification in respect of any specific clearance is a matter of choice with the assessee and any beneficial piece of legislation cannot be forced on the assesse as held in Commissioner of Income-Tax Versus Arun Textile 'C' And Another [2000 (3) TMI 3 - SUPREME Court]. Decided in favor of assessee. - 195/26/2011-RA-CX - 1486/2012-CX - Dated:- 10-10-2012 - Shri D.P. Singh, J. Shri S.C. Kamra and G.K ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tablish that they were maintaining separate accounts evidencing availment or non-availment of Cenvat credit on the inputs and quantity used in the manufacture of each category of final products, whether cleared for home consumption or for export under different export schemes. He failed to appreciate that initially the Board vide Circular No. 795/28/2004-CX., dated 28-7-2004 required the manufacturer to maintain separate books of accounts - for goods manufactured and cleared on payment of duty under Notification No. 29/2004-C.E., dated 9-7-2004 and goods cleared without payment of duty under Notification No. 30/2004-C.E., dated 9-7-2004. However considering practical difficulties of textile manufacturers in maintaining separate account of inputs, the Board advised the assessee not to take credit initially and instead take proportionate credit on inputs used in the manufacture of finished goods that are cleared on payment of concessional duty under Notification No. 29/2004-C.E., dated 9-7-2004. The Board issued Circular No. 845/3/2007-CX., dated 1-2-2007 to this effect. The Commissioner failed to appreciate that in accordance with the Board s circular, the applicant availed Cenvat c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... applicant. Therefore, the applicant did not violate condition(s) of availment of Cenvat credit. 4.4 Both the Commissioner (Appeals) adjudicating authority erred in holding that the applicant failed to draw a distinction between the two notifications and have not substantiated their rebate claim by proving that the goods exported were manufactured out of the goods on which Cenvat credit has (not) been availed. The Commissioner failed to verify the facts and applicant s submission that they have stopped availed Cenvat credit on inputs participating in the manufacture of resultant final products that were exported under rebate claim procedure. Since the applicant were left with huge accumulated balance upto 30-4-2006, the applicant stopped availing Cenvat credit on inputs thereafter and consequently, the question of non-compliance of Notification No. 30/2004-C.E., dated 9-7-2004 does not arise. The Assistant Commissioner failed to appreciate that in respect of refund claims in question, the applicant opted to avail higher duty drawback on export shipments and precisely for that reason, the applicant stopped availing Cenvat credit on inputs and input services used in relation to ma ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n cannot be forced on the assessee. In the case of CIT v. Mahendra Mills - (2000) 243 ITR 56 (SC), the Apex Court has held that if the assessee does not wish to avail the benefit of the exemption, it cannot be forced upon him. 4.8 The Commissioner (Appeals) failed to appreciate that Notification No. 30/2004-C.E., dated 9-7-2004 is a conditional notification and therefore, the said notification is not covered by the provisions of sub-section (1A) of Section 5A of the Act. On the other hand, the benefit of the above notification can be claimed by the assessee if he so opts subject to non-availment of Cenvat credit on inputs that go into the manufacture of exempted goods. The Notification No. 30/2004-C.E., dated 9-7-2004, being conditional, was not been opted for by the applicant in so far as exports under rebate claims are concerned. 4.9 The Commissioner (Appeals) failed to appreciate that Modvat/Cenvat credit scheme is a beneficial scheme. Cenvat Credit Rules, 2004 does not contain any provision to the effect that the manufacturer must opt for the scheme or that, once having opted, he cannot opt out of the scheme subsequently. The scheme is optional. Therefore, even if the appli ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... parate accounts has been dispensed with by the Board vide Circular No. 845/3/2007-CX., dated 1-2-2007. They further stated that they stopped availing Cenvat credit on inputs in the manufacture of their final products from 1-5-2004. They opted for both the notifications from 1-5-2006 and paid duty on export goods from their accumulated Cenvat credit account. 8.1 For the sake of clarity of issue, Government finds it proper to peruse the relevant provision of the two said circulars, which are extracted below :- Circular No. 795/28/2004-CX., dated 28-7-2004 :- Issue No. (1) : Can a manufacturer of textiles or textile articles avail full exemption under Notification No. 30/2004-C.E. as well as clear similar or dissimilar goods on payment of duty under Notification No. 29/2004-C.E. simultaneously? Clarification : Notification No. 29/2004-C.E. (prescribing optional duty at the rates of 4% for pure cotton goods and 8% for other goods) and No. 30/2004-C.E. (prescribing full exemption) are independent notifications and there is no restriction on availing both simultaneously. However, the manufacturer should maintain separate books of account for goods availing of Notification No. 29/ ..... X X X X Extracts X X X X X X X X Extracts X X X X
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