TMI Blog2008 (1) TMI 94X X X X Extracts X X X X X X X X Extracts X X X X ..... 04 in respect of input services used by them in the export of auxiliary services. Since the appellants were unable to utilize the Cenvat credit in respect of the input services availed by them they filed refund claim in respect of un-utilized credit for the period April 2005 to. June 2005 July 2005 to September 2005 and October 2005 to December 2005 respectively as per provisions of Notification No. 4/2006 dated 14-3-2006 by which Rule 5 of the Cenvat Credit Rules, 2004 was substituted. Since Rule 5 prior to its substitution by Notification No.4/2006 dated 14-3-2006 did not provide for refund of unutilized credit to the producer of output services, the claim was rejected by the Assistant Commissioner and his order was upheld by the Commissioner (Appeals) vide his impugned order. Commissioner (Appeals) did not agree with the plea of the appellant that the Rule 5 substituted by Notification No. 4/2006 dated 14-3-2006 was of a clarificatory nature and that they had substantative right to claim refund under those provisions, once all the conditions prescribed under Notification were fulfilled and therefore refund cannot be denied. The Commissioner (Appeals) in his order held that since ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... l be utilised for payment of service tax on any output service. Explanation. - For the purpose of this rule, the words "output service which is exported" means the output taxable service exported in accordance with the Export of Services Rules, 2005." After March 2006: "5. Refund of Cenvat credit. - Where any input or input service is used in the manufacture of final product which is cleared for export under bond or letter of undertaking, as the case may be, or used in the intermediate product cleared for export, or used in providing output service which is exported the Cenvat credit in respect of the input or input service so used shall be allowed to be utilized by the manufacturer or provider of output service towards payment of, (i) duty of excise on any final product cleared for home consumption or for export on payment of duty; or (ii) Service tax on output service, and where for any reason such adjustment is not possible, the manufacturer or the provider of output service shall be allowed refund of such amount subject to such safeguards, conditions and limitations, as may be specified, by the Central Government, by notification: Provided that no refund ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ntral Excise Duties Drawback Rules, 1995 as it stood prior to 14-3-2006 provide for drawback only in respect of the goods exported and did not provide drawback in respect of services exported. It was only with effect from 13-7-2006 that the drawback rules provide for drawback of service tax paid on input services also used in the manufacture of goods exported. Therefore, there is no question of provider of output services availing drawback. There is also no question of even a manufacturer of goods exported availing drawback of service tax paid on input services prior to 13-7-2006. 4. The proviso also bars claiming of rebate of duty under Central Excise Rules, 2002 in respect of such duty. The only provision for rebate in Central Excise Rules, 2002 is contained in Rule 18. That rule even today contemplates rebate of excise duty paid on finished products exported or rebate of excise duty paid on inputs used in the manufacture of products exported. There is no question of, therefore, a provider of output service claiming a rebate of duty under Central Excise Rules, 2002. 5. In view of the above, it was submitted that the five words appearing in the first proviso are clearly su ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ly to express." The expression "where such adjustment is not possible", itself is indicative that certain consequences are herein after provided by rule itself, when adjustment is not possible. If it is interpreted that consequences are provided only for a manufacturer, then sentence is incomplete particularly when adjustment is contemplated or provided both for a manufacturer as also for output service provider. It was accordingly submitted that the five words "or provider of output services" should be taken out from the proviso to Rule 5 as it stood prior to 14-3-2006 and should be substituted after the words "the manufacturer" in the last leg of main Rule 5. 7. The second plea made was that in any view amendment made on 14-3-2006 is merely clarificatory and therefore, retrospective and applies for the past period also. Reference in this regard was invited to the Supreme Court decision in the case of Indian Tobacco Association - 2005 (187) E.L.T. 162 (S.C.) wherein para 27 it has been specifically stated that "Where a statute is passed for the purpose of supplying an obvious omission in a former statute, the subsequent statute relates back to the time when the prior Act ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rovider of output services, also, an additional safeguard was introduced in Rule 5 by addition to the proviso that the provider of output services should not claim rebate of service tax under the Export of Services Rules, 2005 in respect of such taxes. If it would have been a simple omission, then the legislature must have prescribed some procedure for claiming refund and the extent to which refund can be claimed and imposed certain safeguards as has been done only now. In view of this the alleged omission cannot be considered as an obvious mistake in printing/drafting, nor can the amended provisions be considered to be clarificatory in nature and cannot therefore have retrospective effect. 9. We are however in agreement with the last plea taken by the appellants that the refund claim filed by them on 26-4-2006 onwards will be governed by the rules as it stood on those dates. The substituted Rule 5, nowhere suggests or says, that it will apply for exports made after 14-3-2006. Hence any claim filed on or after 14-3-2006 which satisfies other requirements of the rules and notification issued thereunder, cannot be turned down on a ground which is not a condition or requirement of ..... X X X X Extracts X X X X X X X X Extracts X X X X
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