TMI Blog2011 (10) TMI 189X X X X Extracts X X X X X X X X Extracts X X X X ..... hed that the credit cannot be utilized. Condition of export under bond - Held that:- A 100% EOU has to export the goods under bond only, since if it is cleared to DTA unit, Peanut Butter attracted duty. - the condition that the goods should have been exported under bond is fulfilled. - Refund allowed. - E/1222-1224/2010 - A/2012-2014/2011-WZB/AHD - Dated:- 24-11-2011 - MR. B.S.V. MURTHY, J. Represented by: Shri R.R. Dave, Adv. for Assessee. Shri R.Srova, A.R. for the Revenue. Per: Mr.B.S.V. Murthy: The appellant is a 100% EOU engaged in the manufacture of Peanut Butter falling under CETH 15179020 of the Schedule to Customs Excise Tariff Act, 1985. The appellants applied for No Dues Certificate from Excise authorit ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... unt of Rs.3,20,498/- and the period is from October 2008 to December 2008. Both refund claims have been rejected. First refund claim has been rejected on the ground of limitation and the ld. Commissioner has observed that the same is not disputed by the appellant. As regards second refund claim for Rs.3,20,498/-, the same has been rejected on the ground that the appellant could have utilized the CENVAT Credit for payment of duty since the final product was liable to duty and the appellant had cleared more than substantial portion of their goods in DTA. 3. Ld.Advocate on behalf of the appellant submitted that the appellant was eligible to take CENVAT Credit of duty paid at the time of de-bonding and he relied upon the decision of the Tri ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tative for the Department reiterates the stand taken by the lower authorities in the impugned order. 4. I have considered the submissions made by both sides and gone through the records. The facts in the case are peculiar and unique and therefore the stand taken by both sides does not seem to be correct. The product manufactured by the appellant is Peanut Butter, which is totally exempted from payment of duty. Therefore, on 1.7.09, when the appellant became a DTA unit, no CENVAT Credit should have been taken since the Peanut Butter was exempted from payment of duty totally. When the goods are exempted from payment of duty totally, the question of taking CENVAT Credit does not arise. In these cases, the credit was taken on 1.7.09 while t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ized since the appellant never took it in their books till 1.7.09. Therefore, once a view is taken that credit was admissible, the next question that arises is whether the refund of the same could be allowed under Rule 5 of CENVAT Credit Rules or not. For this purpose, what is to be decided is that the appellants could not have utilized the credit for payment of duty and only when the accumulated credit cannot be utilized, the appellant can file a refund claim. In this case, the credit was available on 1.4.09 on the duty paid in April 2009 but was taken on 1;7.09. Since the credit was not taken at all in the books of accounts till 1.7.09, the question of utilization does not arise. When the credit could not have been utilized and gets acc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d. 6. As regards delay in submission of claim, I find that the submission of the appellant that export took place on 26.09.09 and therefore the claim made on 1.9.09 was in time, is acceptable. Nevertheless, in view of the decision in the case of Hindustan Motor's case, cited by me above, it can be said that the only on 1.7.09, the appellant could come to the conclusion that they cannot utilize the CENVAT Credit since the Peanut Butter manufactured by the DTA unit was totally exempted. 7. Another ground taken by the Revenue for rejecting the refund is that the goods have not been exported under bond. A 100% EOU has to export the goods under bond only, since if it is cleared to DTA unit, Peanut Butter attracted duty. Therefore, in respec ..... X X X X Extracts X X X X X X X X Extracts X X X X
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