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Rebate of Excise duty admissible on both inputs & final products

Central Excise - By: - Bimal jain - Dated:- 6-4-2016 Last Replied Date:- 15-4-2016 - Rebate of Excise duty admissible on both inputs & final products Recently, the Hon ble Supreme Court of India Commissioner of Central Excise Nagpur and Anr Vs. Spentex Industries Ltd and Anr [ 2016 (4) TMI 174 - SUPREME COURT ] has dismissed the Review Petition filed by the Revenue against the judgement of the Hon ble Apex Court in the case of Spentex Industries Ltd. Vs. Commissioner of Central Excise [2015 .....

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and the connected papers. We find no error, much less apparent, in the judgment impugned. The review petitions are, accordingly, dismissed…. (Emphasis Supplied) Accordingly, the matter has attained certainty and the exporters can avail rebate of Excise duty paid on inputs used in exported goods as well the Excise duty paid on exported final products under Rule 18 of the Excise Rules. For ease of reference, we are discussing hereunder the judgment of the Hon ble Supreme Court earlier in t .....

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cally as well as exported. For manufacturing of the goods, the Appellant used the raw materials, which was an intermediate product and paid Excise duty thereupon. Thereafter, the Appellant had exported these goods on payment of Excise duty, and filed forty five Rebate claims in terms of Rule 18 of the Excise Rules for an amount of ₹ 1,46,90,995/- (Rs. 75,42,487/- + ₹ 71,48,508/-) in the months of November and December, 2004 respectively. The Rebate claims were filed for both the amou .....

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iled to the Ld. Commissioner (Appeals), it was held that the Appellant is eligible to either rebate of the duty paid on inputs used in the manufacturing of exported goods or duty paid on exported goods but not eligible to both claims. Being aggrieved, the Appellant preferred Revision Application before the Joint Secretary to the Government of India under Section 35EE of the Excise Act, which was allowed and it was held that the Appellant was eligible to claim rebate of duty paid on inputs used i .....

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rt of Bombay, which was allowed in favour of the Appellant. Held: The Hon ble Apex Court after considering historical perspective of the Statutory Scheme and relying upon the following judgments: R & B Falcon (A) Pvt. Ltd. Vs. Commissioner of Income Tax [ 2008 (5) TMI 2 - Supreme court ] Desh Bandhu Gupta and Co. and others Vs. Delhi Stock Exchange Association Ltd. [ 1979 (2) TMI 175 - SUPREME COURT OF INDIA ] Union of India Vs. Kamlabhai Harjiwandas Parekh and others [ 1967 (9) TMI 145 - SU .....

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ed necessary notifications for rebate in respect of both the duties, i.e., on inputs/ intermediate product as well as on the final product, as under: Notification No. 19: Dealing with grant of rebate of whole of duty on excisable goods exported; Notification No. 21/2004-CE(N.T.) dated September 06, 2004 ( Notification No. 21 ): Dealing with rebate of whole of the duty paid on excisable goods used in the manufacture or processing of exported goods. Normally, the words 'OR' and 'AND .....

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manufacture of goods, contained under Rule 18 and Rule 19 thereof. Rule 19 of the Excise Rules enable the exporter to receive the inputs to be used in manufacture of exported goods without payment of Excise duty and remove the exported goods without payment of Excise duty. The word 'OR' occurring in Rule 18 of the Excise Rules cannot be given literal interpretation as that leads to various disastrous results and, therefore, this word has to be read as AND as that is what was intended by .....

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onditions or limitations, if any, and fulfillment of such procedure, as may be specified in the notification Thus, the Hon ble Apex Court held that it cannot be the intention of the Legislature to provide rebate only on one item i.e. either on inputs or final products. It was further held that giving such restrictive meaning to Rule 18 of the Excise Rules would not only be anomalous and absurd, but, it would defeat the very purpose of grant of remission from payment of Excise duty in respect of .....

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ortant-changes-in-service-tax-and-credit-rules-effective-from-april-1-2016/ Central Excise & Customs: http://www.a2ztaxcorp.com/union-budget-2016-important-changes-in-excise-customs-effective-from-april-1-2016/ Hope the information will assist you in your Professional endeavours. In case of any query/ information, please do not hesitate to write back to us. - Reply By surya narayana - The Reply = Dear Sir, Very nice article and discussed the aspects involved in the Apex Court deci .....

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