TMI Blog2015 (10) TMI 1293X X X X Extracts X X X X X X X X Extracts X X X X ..... though printed books were exported as not legally sustainable. It is only in the event the petitioners does not export the printed goods and do not maintain the account as contemplated by rule 6 (2) the petitioner would be required to pay 10% on the sale price of the printed books not so exported. - no CENVAT Credit will be available in respect of the inputs used in the manufacture of exempted products, Rule 6 (6) (v) of the CENVAT Credit Rules creates an exemption inter alia in respect of the excisable goods removed without payment of duty for export under bond in terms of Central Excise Rules, 2002. Considering the language of Rule 6 (6) (v) of the CENVAT Credit Rules, 2004, the petitioners are entitled to avail CENVAT CREDIT in respect of the inputs used in the manufacture of the final products being exported irrespective of the fact that the final products are otherwise exempt. Both from the point of Government and the assessee is to allow the assesses to take CENVAT Credit on the inputs used in the export products and allow the assessee himself to adjust it for payment of duty on other products. If the adjustment is not possible, CENVAT Credit is refunded in cash. This appe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... wed - Decided in favour of assessee. - Appeal No. E/50958/2015-EX[DB] - Final Order No. A/52445/2015-EX(DB) - Dated:- 16-7-2015 - Ashok Jindal, Member (J) And B Ravichandran, Member (T) For the Appellant : Shri Balbir Singh, Adv For the Respondent : Shri R K Grover, DR ORDER Per Ashok Jindal 1. The appellants are challenging the impugned order for denying their claim of refund under Rule 5 of CENVAT Credit Rules, 2004 for export of Menthol Crystals claim to be exported under bond in terms of Rule 19 of Central Excise Rules, 2002. The facts of the case are that the appellants are manufacturer of Menthol Crystal (BP/USP grade), Menthol Powder and Peppermint Oil classifiable under Chapter heading/sub-heading nos. 29061100 and 33012590 and after eight digit code tariff was introduced and classified them under proper heading, appellant was availing CENVAT Credit facility as provided under CENVAT Credit Rules, 2004 in respect of main input, i.e., De-Mentholized Oil and Menthol Flakes. By notification no. 4/08 Central Excise dated 1/3/2008, the Menthol Crystal (BP/USP grade) covered under Chapter heading 30039021 were fully exempted from duty. Therefore, these ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ts that on the issue of the eligible to CENVAT Credit in their own case for the said period, this Tribunal in the case of Nav Bharat Impex Vs. Commissioner of Central Excise, Delhi reported in 2012 (285) ELT 582 (Tri-Del) has held that the appellant is entitled to avail CENVAT Credit and reversal of credit is not warranted. He, further submits that for the exported goods, appellant is not required to comply with the provision of Rule 6 (3) as Rule 6 (6) of the said Rule specifically excludes the applicability of Rule 6 (3) indicates that the goods are exported under bond. To support this contention, he relied on the decision of the Hon'ble High Court of Bombay in the case of Repro India Ltd. Vs. Union of India reported in 2009 (235) ELT 614 Bom.. Therefore, he submits that impugned order be set aside and the appeal may be allowed with consequential relief. 3. On the other hand, ld. AR reiterated the findings of the impugned order. 4. Heard the parties and considered the submissions. 5. The issue of entitlement to avail CENVAT Credit has been settled by this Tribunal in appellant's own case wherein this Tribunal has observed as under: We find that the adjudicatin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on which are reproduced as under: We may also consider the provisions of Rule 6 of the CENVAT Credit Rules, 2004. The relevant portion of Rule 6 (6) (v) reads as under:- The provisions of sub-rules (1), (2), (3) and (4) shall not (6) be applicable in case the excisable goods removed without payment of duty are either:- (i) ........... (ii) ........... (iii) ........... (iv) .......... Cleared for export under bond in terms of provisions of the (v) Central Excise Rules, 2002. The petitioners had manufactured both dutiable and exempted final product (packaged software and printed books respectively). The petitioner has taken credit on input used in the manufacture of dutiable as well as exempted final products. If the exempted products are exported outside India, the provisions of Rule 6 (6) (v) of the CENVAT Credit Rules are applicable. Therefore, the bar provided under Rule 6 (1) and the liability created under Rule 6 (3) (b) of the CENVAT Credit Rules, 2004 are not attracted. By denying to the petitioner from exporting the printed books under bond what the respondents want to do is in fact to levy 10% on the sale price of the printed books in terms of Rule ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he excisable goods removed without payment of duty for export under bond in terms of Central Excise Rules, 2002. Considering the language of Rule 6 (6) (v) of the CENVAT Credit Rules, 2004, the petitioners are entitled to avail CENVAT CREDIT in respect of the inputs used in the manufacture of the final products being exported irrespective of the fact that the final products are otherwise exempt. 7. As per the said provision for applicability of Rule 6 (6) (v), the provision of sub-Rule 1,2 3 and 4 are not applicable where excisable goods are removed without payment of duty in case export is made under bond in terms of the provisions of Chapter 5 of the Central Excise Rules, 2002, As the provision of Rule 6 (3) are not applicable to the facts of this case as the appellant has exported the goods under bond following as per the provision of Rule 19 of the Central Excise Rules, 2002. Therefore, we relied on the decision of Repro India Ltd. reported in 2009 (235) ELT 614 Bombay to say that refund claim cannot be rejected wherein Hon'ble High Court to Bombay has observed as under: The CENVAT Credit is allowed n (sic) the duty paid on inputs to mitigate the effect of double tax ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... its. These are wholly exempt by Notification dated 31st March, 2003. Rule 6 (6) (iii) relates to goods supplied to a unit located in Electronics Hardware Technology Park or Software Technology Park. Such supplies are exempt from duty by notification dated 31st March, 2003. Rule 6 (6) (iv) relates to supplies to United Nations or an International organization for their official use. These are exempt by Notification No. 108/95. Rule 6 (6) (v) relates to export under bond. Rule 6 (6) (vi) relates to gold or silver arising during refining of copper. These are exempt from payment of duty by Notification No. 5/2006-C.E. dated 1st March, 2006. It would thus be clear that all the clauses of Rule 6 (6) are enacted only to deal with the situation when the final products are exempt from payment of duty. If a final product is not exempted from duty, Rule 6 (1) is not attracted at all and hence Rule 6 (6) is unnecessary. Rule 6 (6) is precisely needed only when the final products are exempt from payment of duty. In this context the Revenue itself has accepted that under the provisions of CENVAT Credit Rules, 2002 there was provisions for removal of exempted goods under bond but he same was not ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... is not relevant for the purpose of the present case. Rule 6 (1), 6 (2), 6 (3), 6 (4) of the CENVAT Credit Rules under CENVAT Credit Rules, 2002 as well as under the CENVAT Credit Rules, 2004 remains the same. As noted earlier the object and purpose of Rule 6 (6) of CENVAT Credit Rules, 2004 is to promote the policy of the Government that the benefit of duty paid on input is available as credit in respect of certain exempted goods as well as the exempted goods exported under bond. The minor change in the wordings of Rule 6 (6), of the CENVAT Credit Rules, 2004 by using the term excisable goods instead of exempted goods is that the term exempted goods may not cover the dutiable goods which are exported under bond. Therefore, in order to widen and cover both dutiable and exempted goods exported under bond Rule 6 (6) of CENVAT Credit Rules, 2004 uses the expression excisable goods . As an illustration, if a car which is dutiable is exported under bond without payment of duty there may be doubt as to whether credit on the inputs will be available, since the car is cleared without payment of duty under Rule 6 (5) of CENVAT Credit Rules, 2002. It could be argued that it covers only t ..... X X X X Extracts X X X X X X X X Extracts X X X X
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