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TMI Blog2012 (7) TMI 874X X X X Extracts X X X X X X X X Extracts X X X X ..... 9 for Rs. 4,92,646/- , 122, 124, 125, 128 of 2008-2009 for Rs. 4,64,780/- and 121 & 123 of 2008-2009 for Rs. 1,89,574/- along with requisite documents. It is seen that for paying duty on the clearances under the above said ARE-1s, the assessee have debited the input credit accumulated during the period when they were 100% EOU. There is no provision under the Excise Law or Rules which provides that such credit will be valid, even after the debonding of EOU. On debonding the input credit accumulated if any of the EOU shall lapse. Hence the duty at the time of removal of goods for DTA clearances or for export cannot be debited. The rebate of duty on exports made out of such debits and accumulated cenvat credit of EOU period shall not be admissible. 2.1 After due process of adjudication, the Assistant Commissioner vide their above orders-in-original No. R 256/09-10, dated 23-6-2009 rejected the claim filed by the assessee. 2.2 Being aggrieved by the said orders-in-original, the applicant preferred appeal before Commissioner (Appeals) who set aside the impugned order-in-original and allowed the appeal. 2.3 Being aggrieved by the impugned order-in-appeal the applicant d ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of debonding of EOU Unit makes it clear that applicable Customs and Central Excise Duty would be paid on imported and indigenous capital goods, finished goods, raw material, consumable, components, etc., lying in stock. Thus, it is clear that status of an EOU Unit is completely nullified when it exits the scheme on payment of duty on all the above stocks and obtained normal DTA Unit status. The balance of cenvat credit automatically gets lapsed. The cenvat credit is allowed to EOU strictly for the purpose of paying duty on DTA clearance, only and not for any other purpose, till they work under EOU Scheme. The clearances by M/s. Technocraft, Unit I as a normal unit cannot be termed as DTA clearance because it had lost its status as an EOU. For carry forward of any credit, the same is to be earned, and the provisions for earning are given under Rule 4 ibid, the same have not been complied by the applicant in the instant case. Assessee has thus wrongly utilized the accumulated cenvat credit, and has utilized it for payment of duty on their clearances for export purpose under Rule 18 of Central Excise Rules, 2002 which is incorrect. 2.3.4 The citation of the case of M/s. Rajdhani ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... acturers : * Procurement without payment of duty against CT-3 certificate under notification No. 22/2003-C.E., dated 31-3-2003. * Procurement on payment of duty, without availing exemption under Notification No. 22/03 and claim refund of terminal excise duty under para 8.3(c) of foreign trade policy; * Procure on payment of duty, as above and take credit of cenvat under Cenvat Credit Rules, * Export of goods on payment of duty and claim rebate of duty paid by utilizing cenvat credit. 5.2 The applicants have taken recourse to procuring the inputs on payment of duty and taking credit of cenvat and such credit of cenvat would continue to be in the balance, validly available for utilization, not only during the period, during which the applicants were holding EOU status, but also subsequent to de-bonding. 5.3 That such unutilized credit, since attributable to goods exported is available for cash refund under Rule 5 of CCR, 2004 r/w Notification No. 5/2006-C.E. (N.T.), dated 14-3-2006. 5.4 Under the aforesaid circumstances, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... bsp; Sudhan Spinning Mills - 2006 (201) E.L.T. 273 (T). In view of the above, rebate claim on export of goods as admissible to DTA would also be available to EOU also and denying rebate claim would be incorrect. 5.9 In addition to above, following written submissions were also made/submitted by the applicant for reply to the show cause notice dated 22-2-2011 as was issued in the matter of department's revision application under Section 35EE of the Central Excise Act, 1944 on 29-6-2012 : 5.9.1 That lapsing provision under Rule 11 of CCR would apply in a case where the manufacturer has opted for absolute exemption under the Notification issued under Section 5A of CEA or has opted for value based exemption Notification (SSI Exemption); 5.9.2 That the present case relates to the period 26-3-2009 and with effect from 6-9-2004 by issue of Notifn. No. 18/2004-C.E. (N.T.), EOUs were allowed to utilize cenvat credit for payment of duty. In view of the above, Circular No. 77/99-Cus. would not be applicable to the present case, based on the following judgments : * Sun Pharmaceuticals - 2010 (251) E.L.T. 312 (T). ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ), dated 6-9-2004. The Commissioner (Appeals) has allowed the rebate claims pertaining to duties of excise indicated in the respective ARE-1s as paid at the time of clearance of impugned export goods from the accumulated credit of erstwhile 100% EOU and drawn conclusion on the basis of his combined reading of EXIM Policy, Procedure, Cenvat Credit Rules and Notifications/Circulars as cited/discussed from pages 7 to 10 of his order-in-appeal. In one case (Order-in-Original No. 257/09-10, dated 23-6-2009) he has disallowed the rebate claim of Rs. 3,04,402/- as the applicant had used cenvat credit of EOU prior to its debonding. Further the applicant exporter herein is although not controverting the applicability of the provisions as above but is stressing that interpretation of all such provisions does not debar the payment of duty from such accumulated credit as the said credit does not lapse under any of the provisions of Cenvat Credit Rules. 10. In reference to above Government is of the considered opinion that when statutory provisions of Rule 18 of the Central Excise Rules, 2002 read with Notification No. 19/2004-C.E. (N.T.), dated 6-9-2004 are read in proper perspective alo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... an 100% EOU to DTA Unit. There is no statutory provision to allow transfer of such credit from 100% EOU to DTA Unit. As such it is rightly held by original authority that such credit has lapsed and cannot be utilized for payment of duty on goods exported by DTA Unit. 10.3 The case laws of M/s. Rajdhani Fab Pvt. Ltd. reported as 2008 (221) E.L.T. 435 (Tri.-Mum.) is not applicable in the instant case as the issue of unutilized credit lying in balance with 100% EOU Unit at the time of its conversion into DTA Unit, was not involved in the said case. Similarly, in the case of GTN Exports Ltd. - 2009 (240) E.L.T. 53 (T.-Chennai) the issue was concerning eligibility of Cenvat credit of GTN Exports Ltd. (GTN) and EOU, which had been DTA Unit up to 19-11-2004. So the facts of the said case are different from the case of applicants. Therefore, ratio of said case law is also not applicable to this case. 11. Government therefore keeping in view the observations of Hon'ble Supreme Court in M/s. ITC Ltd. v. CCE [2004 (171) E.L.T. 433 (S.C.)] along with M/s. Paper Products Ltd. v. CC [1999 (112) E.L.T. 765 (S.C.)] that in fiscal statutes, the ordinary and natural meaning of words has ..... X X X X Extracts X X X X X X X X Extracts X X X X
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