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2016 (6) TMI 995 - GOVERNMENT OF INDIA

2016 (6) TMI 995 - GOVERNMENT OF INDIA - TMI - Rebate / refund of duty on goods supplied to SEZ units - admissibility of refund claim of jute cess paid on goods supplied to SEZ units - period of limitation - in supersession of the earlier claim of refund, subsequently the applicant submitted revised claim of ₹ 13,36,029/- The contention of the department in this regard was that as the- applicant has submitted their initial refund claim on 04.08.2009 hence their refund claim for the period .....

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ect of supplies made thereof. - Hence the instant case does not fall with the purview of ambit and scope of provisions contained for Section 35EE read with proviso to Section 35(B) (1) of the Central Excise Act, 1944 under which the instant revision application has been made. - Revision Application filed before Central Government in terms of Section 35 EE of Central Excise Act 1944 is beyond jurisdiction - Revision application dismissed. - F.No. 195/998/13-RA-CX - ORDER NO. 58/2016-CX - Dated:- .....

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the applicant,a manufacturer of articles of Jute falling under classification no. 53071010 of Central Excise Tariff Act, 1985 have submitted a refund claim for ₹ 13,47,341/- to the Assistant Commissioner of Central Excise Budge, Budge-I Division under Section 11 B of the Central Excise Act, 1944 as they have delivered their excisable goods (Jute Yarn) from their factory premises to a unit at Special Economic Zone, Falta on payment of Jute Cess as well as Education Cess and Higher Education .....

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heir refund claim for the period from 01.072008 to 04.08.2008 has become time barred and hence non grantable. Moreover, as detailed in the Notification No. 19/2004-CE(NT) dated 06.09.2004 [equivalent to Notification No. 42/2001-CE(NT) dated 26.06.2001] duties and cesses allowable for rebate under Rule 18 of the Central Excise Rules, 2002 are under:- a. Central Excise Act, 1944 b. Additional duty of Excise (goods of Special Importance) Act 1957 c. Additional Duty of Excise (Textiles and Textiles .....

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of the Finance Bill 2007. i. Jute Cess paid under the Jute Manufacturers Cess Act 1983 read with the Jute Manufacturers Cess Rules, 1984 do not come within the purview of Duty for the purpose of Refund claim. Further contention of department was that the Jute Cess also cannot be refunded due to the restriction as enshrined in Rule 4 of the Jute Manufacturers Cess Rules, 1984 which states that IINO refund of Cess allowed on the jute manufacturers exported...". 2.1 Therefore, a Show Cause No .....

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Division, Kolkata-VII Commissionerate vide Order-in-Original No.2-R/BB-I/Kol-VII/10-11 dated 12.07.2010 rejected the refund of Jute Cess amounting to ₹ 13,08,097/and claim of Refund of Education Cess amounting to ₹ 4282 and Higher Education Cess amounting to ₹ 2140 for the period 01.07.2008 to 04.08.2008 but refund of Education Cess amounting to ₹ 21886 and Higher Education Cess amounting to ₹ 10936 for the period from 05.08.2008 to 18.06.2009 was allowed. 3. Aggrie .....

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under Section 35 EE of Central Excise Act, 1944 before Central Government on the following grounds: 4.1. That the instant Order-in-Appeal travels beyond the notice dated 07.05.2010 and the Order-in-Original dated 12.07.2010 passed thereunder in as much as the instant refund claim arising out of inadvertent payment of jute cess, education cess and higher education cess thereon, in respect of supplies from the applicant's DTA unit to its SEZ unit was never sought to be denied on the ground of .....

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evenue never canvassed and which the applicant was never required to meet in the original proceedings cannot be made out in favour of the revenue at the appellate stage. That the Order-in-Appeal in so far as it rejected the refund claim on the ground of unjust enrichment clearly travels beyond the original proceedings and thereby deserves to be set aside on the short ground alone. 4.2. That the Appellate Commissioner failed to appreciate that the jute goods in the instant case were supplied by t .....

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e (a) to the proviso to Section 11 B (2) of the Central Excise Act, 1944. That the provisions of unjust enrichment are not applicable to an export transaction also stands settled by the decision of the CESTAT in the following case: 1. CST Vs S. Mohanlal reported in 2. Convergys India Services Pvt. Ltd vs CST, reported in That the rejection of refund claim of jute cess inadvertently paid on an export transaction by the appellate Commissioner is ex facie bad in law 4.3. That the DTA unit and the S .....

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m serious infirmities. 4.4. That jute cess in the instant case was paid under a mistake of law, in as much as Section 7 of the SEZ Act specifically exempts payment of jute cess in respect of goods supplied from DTA to a unit in the SEZ. That in the present case, it is undisputed that the jute yarn supplied by the DTA unit during the relevant period was received by the SEZ Unit and such supplies were made under the cover of ARE-I, Bill of Export and Central Excise Cum Tax Invoice as also accepted .....

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urement of goods from the DTA in terms of the said Rule, the DTA supplier supplying goods to a unit in the SEZ is required to clear the goods, as in the case of exports either under bond or as duty paid goods under claim of rebate on the cover of AREI referred to in Notification No. 42/2001-CE(NT). That Rule 30(1) of the SEZ Rules could only confer an option to the DTA unit to either claim the exemption upfront by supplying goods to the SEZ Unit without payment of jute cess under bond or pay the .....

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or rules, in view of the over-riding effect of the provisions of SEZ Act, by virtue of Section 51 of the SEZ Act. 4.6. That the Jute Cess Act vide Section 3 incorporates by reference the provisions of the Central Excise Act relating to refunds, the applicant preferred a refund application under Section 3 of the Jute Cess Act read with Section 11B of the Central Excise Act. That it would be fallacious to assume that the instant refund claim has been filed under Rule 18 of the Central Excise Rules .....

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authority while passing the Order-in-Original. 4.8. That SEZ Act is a special enactment and by virtue of Section 51 thereof has an over-riding effect over any other law to the extent the provisions of such other law are inconsistent. That the Order-in-Original in so far as it sought to deny the refund on the ground that Rule 4 of the Jute Cess Rules, did not provide for any dispensation from payment of jute cess in respect of jute goods exported out of India is completely unjustified and stems f .....

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ed by Section 7 of the SEZ Act has to prevail over anything repugnant contained in the Jute Cess Rules. That Rule 4 of the Jute Cess Rules cannot be made the basis to deny the refund claim as attempted in the Order-in-Original. 5. Personal hearing scheduled in this case on 05.08.2015 was attended by Shri Arvind Baheti, Senior Associate, Khaitan & Co. on behalf of the applicant who reiterated the grounds of revision application and submitted that this is a refund claim under Section 3 (4) of .....

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& Co on behalf of the applicant who reiterated the earlier submission and also stated that the show cause notice proceeds on assumption that claim is under Rule 18 and not Section 11 of the Act; that it is duty paid under mistake of law; that in terms of Section 7 of SEZ Act Jute Cess is exempt; that in terms of Section 51 of the SEZ Act, the Act has over riding effect if any provisions of any other law for the time being in force is inconsistent; that the question of unjust enrichment does .....

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s and perused the impugned Order-in-Original and Order-in-Appeal. 7. Government observes that the applicant had submitted a refund claim for ₹ 13,47,341/- to the jurisdictional Assistant Commissioner under Section 11B of the Central Excise Act, 1944 as they have delivered their excisable goods (Jute Yarn) from their factory premises to a unit at Special Economic Zone, Falta on payment of Jute Cess as well as Education Cess and Higher Education Cess for the period from 01.07.2008 to 18.06.2 .....

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6.06.2001 ] duties and cesses allowable for rebate under Rule 18 of the Central Excise Rules, 2002, do not come within the purview of duty for the purpose of Refund claim; that the Jute Cess also cannot be refunded due to the restriction as enshrined in Rule 4 of the Jute Manufacturers Cess Rules, 1984. The adjudicating authority rejected the refund of Jute Cess amounting to ₹ 13,08,097/- and claim of Refund of Education Cess amounting to ₹ 4282 and Higher Education Cess amounting to .....

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tioned amount of ₹ 32,822/- along with appropriate interest into Government account. Now the applicant has filed this revision application on the grounds stated in para 4 above. 8. From a perusal of the impugned Order-in-Appeal, Government observes that aggrieved by the impugned Order-in-Original both the applicant and the department had filed appeal under Section 35 of the Act before the Commissioner (Appeals). The applicant had appealed mainly on the grounds that refund claim was filed u .....

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No. 42/2001 dated 26.06.2001 and the same remains undisputed; that the said rule does not prescribe that the rebate claim shall have to be filed under Rule 18 read with Notification No. 19/2004-CE(NT). The Assistant Commissioner of Central Excise mainly filed appeal before Commissioner (Appeals) on the grounds that the adjudicating authority failed to appreciate the fact that the assessee have categorically demanded that their subject supplies do not fall within the scope of 'export' wi .....

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ment and held that since the refund claim did not satisfy the provision of Section 11 B of the Central Excise Act, 1944 in regard to unjust enrichment he did not find any necessity to discuss the points raised by the party in their appeal against the same impugned order and disallowed the refund claim. 9.Government further observes that under Section 35 EE of the Central Excise Act, 1944, a Revision Application against the Order of Commissioner (Appeals) passed under Section 35 A ibid lies with .....

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by the Central Board of Excise and Customs constituted under the Central Boards of Revenue Act, 1963 (54 of 1963) (hereafter in this Chapter referred to as the Board) or the Appellate Commissioner of Central Excise under Section 35, as it stood imn7ediate/y before the appointed day; (d) an order passed by the Board or the Commissioner of Central Excise either before or after the appointed day; under Section 354, as it stood immediate/y before that day: Provided that no appeal shall lie to the A .....

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