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2019 (5) TMI 1017

Cenvat Credit when the goods are exported - HELD THAT:- Rule 5 of CCR, 2004 specifically indicates what “export goods” would mean and it requires such goods to be ‘exported out of India’. However, the question is what is ‘exported out of India’ would mean. In the normal cases, India includes the territorial waters of India and the export requires goods to be moved to a place outside territorial waters of India. As far as SEZs are concerned, the definition of DTA under SEZ Act includes everything located outside SEZs. Therefore, 100% EOU located outside SEZ, constitutes DTA as far as SEZ Act is concerned. Sec.51 of SEZ Act also makes it clear that this Act prevails over any other law. It has also been clar .....

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pellant who is a 100% Export Oriented Unit (EOU) to SEZ units. 5. The case of the revenue is that Rule 5 of CCR, 2004 provides for refund of Cenvat Credit when the goods are exported. There is no scope for deemed exports to be considered as exports for this purpose. The rule itself indicates in explanation (1) at Sl.No.1A that Export goods means any goods which are to be taken out of India to a place outside India. It is the position of the department, therefore, that goods which are supplied to units in SEZ cannot be treated as exports because they are sold within India. Therefore, provisions of Rule 5 do not apply and no refund is admissible on such supplies. It is the case of the appellant that as far as SEZs are concerned, they are gove .....

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ry provisions in any other law. Therefore, they are entitled to refund of Cenvat Credit on such exports under Rule 5 of CCR, 2004. 8. Learned counsel for the appellant submits that this issue was clarified by the CBEC in Circular No. 1001/8/2015-CX dated 28.04.2015 in which one of the questions addressed is regarding refund of accumulated Cenvat Credit when goods are cleared from DTA to SEZ. It has been clarified in the Circular that since SEZ is deemed to be outside Customs territory of India any clearance of goods from DTA to SEZ will continue to be export and therefore entitled to refund or rebate under Rule 18 of Central Excise Rules, 2002 and of refund of accumulated Cenvat Credit under Rule 5 of CCR, 2004, as the case may be. He also .....

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s are concerned, a special deeming provision has been made in the Act itself and supplying of goods providing services from DTA to SEZ shall be treated as exports. The DTA as defined in the SEZ Act includes the whole of India except the SEZs. It is true that in the normal provisions pertaining to 100% EOUs, the unit is expected to export their goods and any supplies by the 100% EOUs for sale within the country is treated as sale to DTA. On such supplies excise duty at a rate equivalent to that of Customs Duty leviable on similar product is charged. In that context, the term DTA is taken as not including 100% EOU. 11. However, as far as SEZs are concerned, the definition of DTA under SEZ Act includes everything located outside SEZs. Therefor .....

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