TMI Blog2015 (1) TMI 527X X X X Extracts X X X X X X X X Extracts X X X X ..... the additional machinery installed after 31.12.2005, they will not claim the benefit under the exemption Notification No.39/2001CE and they will claim the rebate of the duty on export of goods. The aforesaid is rightly rejected by the Revisional Authority. The petitioners cannot be permitted to claim the rebate under Rule 18 of the Rules on the exported goods manufactured on additional machinery installed after 31.12.2005, may be on maintaining the separate accounts. Under the circumstances, as such the Revisional Authority has rightly denied the rebate to the petitioners on the exported goods on additional machinery installed after 31.12.2005, relying upon clause 2(h) of the notification under Rule 18 of the Rules. - admittedly, there is no new product by installing fresh plant, machinery or capital goods after the cutoff date i.e. 31.12.2005. The same product is manufactured / continued to be manufactured however, some additional machineries have been installed. Under the circumstances, the petitioners shall not be entitled to the benefit of exemption under Notification No.39/2001CE. The further distinction is sought to be canvassed by the petitioners i.e. the goods manufactu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... That according to the petitioners, since the goods were supplied to Kandla Special Economic Zone, it is to be considered as export of goods under the scheme of the Special Economic Zones Act, 2005 [hereinafter referred to as SEZ Act ], which also gives deemed benefit to local/DTA industries who supplies goods or to provide services in the SEZ demarcated area as if it is exported out of India and get all the benefits which are otherwise available to a normal exporter who exports its goods or to provide services to a unit out of India. [2.2] That the petitioners filed various rebate claims of the duty rebate on clearance to the SEZ as export before the concerned authority and uses the capital goods installed after 31.12.2005. According to the petitioners, if the goods are manufactured from plant and machinery installed after 31.12.2005, they were eligible for rebate under Notification No.39/2001CE( NT) and therefore, benefit under Rule 18 is available as per its scheme to the petitioners. That the Deputy Commissioner vide separate orders allowed the rebate claims. [2.3] Being aggrieved with the orders in original sanctioning rebate claims by the Deputy Commissioner, Department ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... No.2(h) is quite clear and it puts embargo on ground of rebate in case of export of goods manufactured by manufacturers availing benefit of Notification No.39/2001CE and consequently the learned Revisional Authority has quashed and set aside the order in original as well as the order in appeal, rejecting the rebate claims of the petitioners. [2.6] Feeling aggrieved and dissatisfied with the impugned order passed by the learned Revisional Authority respondent No.2 herein, petitioners have preferred the present special civil application under Article 226 of the Constitution of India. [3.0] Shri Dhaval Shah, learned advocate appearing on behalf of the petitioners has vehemently submitted that the Revisional Authority has materially erred in holding that the rebate claim is not admissible to the petitioners. [3.1] It is further submitted by Shri Shah, learned advocate appearing on behalf of the petitioners that the Revisional Authority has failed to consider the overriding effect of Special Act i.e. SEZ Act on all other Acts. It is submitted that subclause (c) of Section 26 of the SEZ Act gives specific exemption to the unit in SEZ from any duty of excise, under the Act or t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ired to be maintained to distinguish production of this product from the products which are eligible for the exemption. It is submitted that in the present case admittedly the petitioner maintained separate accounts of capital goods and raw materials after cutoff date i.e. 31.12.2005 and before cutoff date. It is submitted that therefore now denying the rebate only on the ground that Notification No.19/2004CE got amended by Notification No.37/2007CE (NT) is nothing but depriving the petitioner in claiming their substantial benefit of rebate, which is not tenable in the eyes of law and the same is against the provisions of the Act. Making above submissions, it is requested to admit/allow the present special civil application. [4.0] Present petition is opposed by Shri R.J. Oza, learned Counsel appearing on behalf of the Department. It is submitted that as the petitioner was eligible for exemption under Notification No.39/2001CE and infact availed the benefit of the said notification and therefore, considering clause 2(h) of the Notification No.39/2001CE, which was issued under Rule 18 of the Rules, the petitioner is rightly denied the rebate. It is further submitted that as suc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... be applied for a period not exceeding 5 years from the date of commencement of commercial production by such unit. [5.1] As per the notification issued under Rule 18 of the Rules, which provides for rebate of duty on export of goods to all the countries other than Nepal and Bhutan, rebate is not allowable in case of export of goods which are manufactured by a manufacturer availing the notifications mentioned in clause 2(h) of the said notifications inclusive of Notification No.39/2001CE dated 31.07.2001. In the present case, the petitioners were availing the benefit of exemption notification No.39/2001CE dated 31.07.2001. It is an admitted position that the petitioners established their units in the Kutch area and installed the plant and machinery prior to 31.12.2005 (cutoff date) and also started manufacturing the goods and exported the goods after availing the benefit of exemption Notification No.39/2001CE. However, the petitioners installed additional machineries after 31.12.2005 and claimed the rebate with respect to the export of goods which are manufactured on the additional machinery installed after 31.12.2005 by submitting that with respect to the exports of such goods w ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... will be required to be maintained to distinguish production of these products from the products which are eligible for exemption. It also further clarifies that where a unit starts producing some products [after the cutoff date] using the plant and machinery installed upto cutoff date and without any addition to the plant and machinery, in that case, the unit would be eligible for the benefit of exemption notification because the plant and machinery used for manufacturing has remained the same. In the present case, admittedly, there is no new product by installing fresh plant, machinery or capital goods after the cutoff date i.e. 31.12.2005. The same product is manufactured / continued to be manufactured however, some additional machineries have been installed. Under the circumstances, the petitioners shall not be entitled to the benefit of exemption under Notification No.39/2001CE. The further distinction is sought to be canvassed by the petitioners i.e. the goods manufactured on the machinery installed prior to 31.12.2005 and the same product manufactured on the additional machinery installed after 31.12.2005, for the purpose of claiming the exemption under Notification No.39/20 ..... X X X X Extracts X X X X X X X X Extracts X X X X
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