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2013 (9) TMI 998

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..... a ‘nil’ rate prescribed under Notification No. 29/2004-C.E. as amended and the other ‘4% adv.’ prescribed under Notification No. 59/2008-C.E., dated 7-12-2008. Both these rates were unconditional rates. Therefore, it is not the case that the goods have been completely exempted. When two different Notifications prescribe two rates of duty, the assessee is at liberty to opt for whichever is beneficial to him. It is further on record that the assessee had consulted the department and as per the department’s advice, the assessee had opted for payment of duty @ 4% under claim for rebate in respect of exports in some cases. Therefore, it is not a situation where the duty credit on inputs were availed in respect of exempted goods and dutiable goo .....

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..... /2008-C.E., dated 7-12-2008 was issued prescribing a concessional rate of duty of 4% on cotton fabrics. The appellants were clearing the goods in the domestic tariff area without payment of duty claiming exemption Notification No. 30/2004. However, in respect of exports they were clearing the cotton fabrics either under bond without payment of duty under Rule 19 of the Central Excise Rules, 2002 or on payment of duty @ 4% under claim for rebate. A show cause notice dated 4-1-2010 was issued to the appellant asking them to pay an amount of ₹ 3,26,99,951/- under Section 11A(1) of the Central Excise Act read with Rule 14 of the Cenvat Credit Rules, 2004 on the ground that they had availed Cenvat credit on the inputs used in the manufactu .....

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..... ed an amount of ₹ 31,64,578/- paid by the appellant as duty on export clearances of processed cotton fabrics under claim for rebate during the aforesaid period. The appellant is before us against the said order. 3. The learned counsel for the appellant submits that the provisions of Rule 6(1), 6(2) and 6(3) of the Cenvat Credit Rules, 2004 does not apply to export of goods and, therefore, the demand is not sustainable. He further submits that during the material time, there were two Notifications in operation in respect of cotton fabrics - one, Notification No. 29/2004-C.E. as amended which prescribed a nil rate of duty on cotton fabrics not containing any other textile material. There was another Notification No. 59/2008-C.E., d .....

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..... he jurisdictional Assistant Commissioner. In the light of the above submissions, they pray that the appeal be allowed. 4. The learned Additional Commissioner (AR) appearing for the department reiterates the findings of the Commissioner in the impugned order and submits that Notification No. 29/2004-C.E. as amended grants complete exemption to cotton fabrics not containing any other material whereas Notification No. 59/2008 grants exemption to other cotton fabrics (that is cotton fabrics containing other textile material) and, therefore, the appellant s contention that there were two rates on cotton fabrics is not factually correct. He further submits that the appellant has never declared to the department the composition of the cotton fa .....

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..... 37/- the cotton fabrics have been exported under bond and, therefore, in terms of Rule 6(6)(v) of Cenvat Credit Rules the demand is unsustainable. As regards the balance amount of ₹ 76,81,014/- wherein the cotton fabrics have been exported under claim for rebate of duty, it is seen that, at the material point of time, there were two rates of duty applicable to cotton fabrics - one a nil rate prescribed under Notification No. 29/2004-C.E. as amended and the other 4% adv. prescribed under Notification No. 59/2008-C.E., dated 7-12-2008. Both these rates were unconditional rates. Therefore, it is not the case that the goods have been completely exempted. When two different Notifications prescribe two rates of duty, the assessee is at .....

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