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2013 (5) TMI 735 - GUJARAT HIGH COURTSSI Exemption and export - payment of duty on export and claiming rebate / refund - utilization of credit of duty paid on capital goods - interpretation of exemption notification and Rule 5 of CCR - held that:- a manufacturer seeking benefit of such exemption notification was not entitled to avail credit of duty on inputs used in the manufacture of goods of which such exemption was being availed and cleared for home consumption and of which the exemption was availed. Restriction on utilization of credit of duty on capital goods - held that:- The limitation on utilization of the cenvat credit on capital goods for payment of duty is “on the aforesaid clearances”. The reference to “on the aforesaid clearances” must be seen as a reference to the goods cleared for home consumption referred to in clause (iii), just preceding clause (iv) of which the limitation of non-utilization of cenvat credit on inputs used in manufacture of such specified goods is imposed. To put it differently, clause (iv) of para 2 thereof puts a restriction on the manufacturer utilizing credit of duty paid on capital goods on the clearances made for home consumption and not for the exports. The adjudicating authority as well as the Government, in our opinion, committed an error in interpreting such provision. The adjudicating authority, therefore, erred in holding that the petitioner erroneously paid duty on clearances for export which duty was otherwise exempt under the notification. In fact, the notification itself is clear in this respect and grants exemption from payment of clearances made for home consumption. - Revenue directed to grant rebate / refund - decided in favor of assessee.
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