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2013 (10) TMI 1308 - CGOVT - CustomsDenial of drawback claim - applicant manufactured/exported the product in question contained raw material on which no duty was paid - applicant availed Cenvat credit on capital goods - violation of para 13 of the Notification No. 103/2008-Cus. (N.T.), dated 29-8-2008 - Whether the drawback claim, arising out of export of cotton yarn is hit by the proviso (ii) to the Rule 3(i) of the Customs, Central Excise Duties and Service Tax Drawback Rules, 1995, or not - Held that:- From harmonious perusal of Circular/clarification, it is clear that AIR rate of DBK is available even where the inputs used in the export have suffered “Nil” rate of duty, because the drawback rate arrived at by taking into account also the duties suffered on export product at prior stage of manufacture. Further, taxes paid as input services and duty suffered on packing materials are to be factored in. As such, denials of AIR of drawback only by quoting Rule 3(1)(ii) of said Drawback Rules without considering clarification issued by the Board from time to time, is not correct and hence, is not tenable. Original authority also observes that the applicant has availed Cenvat facility of capital goods and hence violated the Provision contained in Board’s Circular No. 103/2008-Cus. (N.T.), Government observes that condition of non-availment of Cenvat credit referred to in the context of said circular means non-availment of Cenvat credit on input or input services. The C.B.E. & C. vide Circular No. 42/2011-Cus., dated 22-9-2011, has clarified that the expression : “when Cenvat credit facility has not been availed”, means Cenvat facility on inputs and input services and is to be understood as such. Hence, observation of lower authority on this count also is not tenable. Government further notes that Commissioner (Appeals) in his subsequent Order-in-Appeal No. 38/BPL/13, dated 5-2-2013, in the case of M/s. Anant Raison MP, has allowed drawback claim in such case. Therefore, Government holds that drawback claims in these cases are admissible to the applicant. - Decided in favour of assessee.
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