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2016 (4) TMI 192 - CGOVT - Central ExciseRebate claims of duty paid on exported of exempted goods under Rule 18 of the Central Excise Rules, 2002 read with Notification No. 19/2004-C.E. (N.T.), dated 6-9-2004 - Held that:- Government finds that there is no merit in the contentions of applicants that they are eligible to claim rebate of duty paid @ 10%, i.e., General Tariff Rate of Duty ignoring the effective rate of duty @ 0%/4% or 5%. As such, Government is of considered view that lower authorities are legally right in holding that rebate is admissible only to the extent of duty paid at the effective rate of duty, i.e., 0%/4% or 5% in terms of Notification No. 4/2006-C.E., dated 1-3-2006 as amended, as applicable on the relevant date on the transaction value of exported goods determined under Section 4 of Central Excise Act, 1944. Hence the Order-in-Appeal are upheld to that extent. In some cases the original authority either denied rebate where excise duty payable was NIL in terms of Notification No. 4/2006, dated 1-3-2006 read with Notification No. 21/2002-Cus., dated 1-3-2002 or confirmed recovery of rebate erroneously sanctioned on the ground that duty was not payable by the applicant. As held in above paras, the rebate is admissible only to the extent of 0%/4%/5% as the case may be. The Notification No. 4/2006, dated 1-3-2006 issued under Section 5A(1A) of the Act, grants exemption from whole of duty of excise absolutely. So applicant was required not to pay duty. The amount so paid cannot be treated as duty under Section 3 of the Act and therefore, not admissible as rebate under Rule 18 of Central Excise Rules, 2002 read with Notification No. 19/2004-C.E. (N.T.), dated 6-1-2004. Moreover, when goods are exempted from payment of duty, no Cenvat credit is permissible under Rule 6(1) of Cenvat Credit Rules, 2004. In view of the above, Government observes that the applicant was not allowed to pay duty on the exempted goods as per proviso 5A(1A) of Central Excise Act, 1944 and no Cenvat credit on the inputs is available under Rule 6(1) of Cenvat Credit Rules, 2004. Further the applicant has also not claimed that the duty on such fully exempted goods has not been paid from such inadmissible Cenvat credit and therefore, no re-credit is permissible in such cases. Hence, Government finds that orders of recovery by original/appellate authority are legal and proper.
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