TMI Blog2012 (11) TMI 1065X X X X Extracts X X X X X X X X Extracts X X X X ..... nts at their own volition which is required to be returned to them in the manner it was initially paid, because the Government cannot retain the same without any authority of law as held by Hon’ble High Court of Rajasthan in the case of CCE, Jaipur v. Suncity Alloys Pvt. Ltd. reported as [2007 (2) TMI 137 - HIGH COURT, RAJASTHAN]. - Decided in favour of assessee. - F. No. 195/281/2011-CX - 1604/2012-CX - Dated:- 20-11-2012 - Shri D.P. Singh, Joint Secretary Shri Ganesh Bapu T.R., Advocate, for the Assessee. Shri K.K. Jain, Superintendent, for the Department. ORDER This revision application is filed by the applicant M/s. Ginni International Ltd. (Weaving Division), Neemrana, against the order-in-appeal No. 62(DKV) CE/JPR-I/2011, dated 14-2-2011 passed by Commissioner of Customs Central Excise (Appeals) - I, Jaipur, with respect to Order-in-Original No. 17/R/2010, dated 26-2-2010 passed by Deputy Commissioner, Central Excise Division, Alwar. 2. Brief facts of the case are that the applicant have filed a rebate claim amounting to ₹ 3,55,673/- on 12-6-2008, in respect of Central Excise duty paid on 100% cotton yarn falling under Chapter Heading No. 5205 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... till the date of final debonding i.e. up to 31-3-2008. 2.3 Therefore a show cause notice was issued to the appellant and after considering the submissions made by the appellant, the adjudicating authority has rejected the rebate claim of ₹ 3,55,673/- vide impugned order. 3. Being aggrieved by the said order-in-original, the applicant filed appeal before Commissioner (Appeals) who upheld the impugned OIA and rejected the appeal of the applicant. 4. Being aggrieved by the said order-in-appeal, the applicant has filed this revision application under Section 35EE of the Central Excise Act, 1944 before Central Government on the following grounds : 4.1 The issue relates to denial of rebate of duty paid on finished goods exported under Rule 18 of the Central Excise Rules, 2002 read with Notification No. 19/2004-C.E. to the extent of ₹ 3,55,674/- on the ground that the clearances made by the applicants were not liable to duty in terms of Notification No. 24/2003-C.E., since the clearances made prior to issue of debonding certificate shall be deemed to have been made by a 100% EOU. 4.1.2 The applicants submit that there is dispute on the fact that the applicants ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... safeguarding any future liability if any and get out of the scheme immediately. This submission also supports the submission of the appellants that once duties have been fully paid, the unit of the applicants ceased to be a 100% EOU. 4.2.1 One of the contentions raised by the Commissioner (Appeals) in the impugned order that the provisions of Section 5A(1A) of the Central Excise Act, 1944 make it mandatory to applicants to avail exemption under Notifications No. 24/2003-C.E. and they had no option to pay duty on the clearances. The applicants have already submitted supra that the provisions of Notification No. 24/2003-C.E. do not have application to the clearances made by the applicants after payment of all the Customs and Central Excise duties during the course of debonding process. Since the FTP provisions specifically provide for non-availability of exemption to capital goods or inputs during the intervening period till the issuance of Debonding Certificate as has been explained supra, the question of bringing the Notification No. 24/2003-C.E. cited by the Commissioner (Appeals) cannot arise at all. 4.2.2 The notification provides that all the goods manufactured and clear ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ch goods if the exemption is absolute. In other words, Section 5A is applicable only where exemption is absolute/without any condition. The word absolute has a specific connotation. 4.4.1 The applicants submit that it is the department s contention that duty was not payable on the clearances made by 100% EOU. Yet the fact remains that the applicants cleared the goods on payment of duty and such duty has been collected by the department without any objection whatsoever. Without prejudice to their submission that since the unit was already in the process of debonding, it ceased to be a 100% EOU, yet the Government cannot retain the amount of duty paid by the applicants which has been sought as rebate after effecting exports. 4.5.1 In the present case, the exports were effected in March, 2008, yet the applicants have not been sanctioned rebate by raising dispute that the unit got debounded only on 31-3-2008. The applicants would be entitled to cash rebate along with interest for the delayed refund in terms of Section 11BB of the Central Excise Act, 1944. The applicants respectfully pray accordingly to grant interest on delayed refund. Case laws relied upon by the applicants ar ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... onding order by the Development Commissioner, is the relevant date and till that date the unit remains and EOU. 5.3 The interpretation of the language of policy as taken by the appellant that once the duties have been paid, unit to be treated as debonded, is fallacious. The debonding is effective from the date of issue of debonding certificate by the Development Commissioner and not the date when duties are paid. The contention of the appellant is not tenable because the unit was formally de-bonded on 31-3-2008, when debonding certificate was issued by the Development Commissioner and prior to this date the unit remains and EOU and therefore the unit being EOU was not required to pay duty on the said export in terms of Notification No. 24/2003-C.E., dated 31-3-2003. 5.4 The contention of the appellant that vague interpretation of the policy provision has been taken by the department in rejection of rebate claim is not correct. Rather the correct provisions of Para 6.18 of policy has been interpreted by the department where it is clearly laid down that the date of debonding would be the date when Development Commissioner issues final debonding order. 5.5 The contention of t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to be paid cannot be retained by the department, goes to prove that the rebate under Rule 18 of Central Excise Rules, 2002, is not admissible to them. 5.9 The plea of the appellant for interest of delayed refund is not tenable, because the claim of rebate is legally not sustainable. The assessee has not become entitled to refund/rebate by any authority so far hence question of payment of interest on delayed refund does not arise. 6. Personal hearing was scheduled in this case on 9-10-2012 Shri Ganesh Bapu T.R. advocate appeared on behalf of the applicant who reiterated the grounds of revision application. Shri K.K. Jain Supdt. attended personal hearing on behalf of department and stated that the OIA may be upheld. 7. Government has carefully gone through the relevant case records and perused the impugned orders-in-original and orders-in-appeal. 8. On perusal of records, Government observes that applicant filed rebate claim of ₹ 3,55,673/- claiming their status as DTA Unit w.e.f. 4-3-2008 when they had discharged all the Customs Central Excise duties for conversion of their 100% EOU Unit to DTA Unit. The adjudicating authority rejected the claim on the ground tha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ry provisions which are extracted below : 9.2 Notification No. 24/2003-C.E., dated 31-3-2003 states as follows : In exercise of the power conferred by sub-section (1) of section 5A of Central Excise Act, 1944 (1 of 1944) read with sub-section (3) of section 3 of the Additional Duties of Excise (Goods of Special Importance) Act, 1957 (58 of 1957) and sub-section (3) of section 3 of the Additional Duties of Excise (Textiles and Textile Articles) Act, 1978 (40 of 1978), the Central Government, being satisfied that it is necessary in the public interest so to do, hereby; (a) Exempts all excisable goods produced or manufactured in an export oriented undertaking from whole of duty of excise leviable thereon under section 3 of Central Excise Act, 1944 (1 of 1944) and additional duty of excise leviable thereon under section 3 of Additional Duties of Excise (Goods of Special Importance) Act, 1957 (58 of 1957) and addition duty of excise leviable thereon under section 3 of Additional Duties of Excise (Textiles and Textile Articles) Act, 1978 (40 of 1978) : Provided that the exemption contained in this Notification in respect of duty of excise leviable under section 3 of said Ce ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y paid without authority of law cannot be treated as duty paid on the exported goods. As such rebate claim is not admissible in terms of Rule 18 of Central Excise Rules, 2002, read with Notification No. 19/2004-C.E. (N.T.), dated 6-9-2004. Government finds support from the observations of Hon ble Supreme Court in the cases of M/s. ITC Ltd. v. CCE reported as 2004 (171) E.L.T. 433 (S.C.), and M/s. Paper Products v. CCE reported as 1999 (112) E.L.T. 765 (S.C.) that the simple and plain meaning of the wordings of statute are to be strictly adhered to. CBEC has also clarified vide letter F.No. 209/26/09-CX.6, dated 23-4-2010 (para 2) as under : The matter has been examined, Notification No. 24/2003-C.E., dated 13-3-2003 provides absolute exemption to the goods manufactured by EOU. Therefore, in terms of Section 5A(1A) of the Central Excise Act, 1944, EOUs do not have an option to pay duty and thereafter claim rebate of duty paid. 11. However, Government is of opinion that the duty paid in this instant case is to be treated as voluntary deposit made by the applicants at their own volition which is required to be returned to them in the manner it was initially paid, because the G ..... X X X X Extracts X X X X X X X X Extracts X X X X
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