TMI Blog2022 (2) TMI 1380X X X X Extracts X X X X X X X X Extracts X X X X ..... dure as may be specified in the notification. As per this rule thus, upon export, an exporter is entitled to claim rebate on the duty paid on export goods as well as on materials used in manufacture or processing of such goods. This would of-course be subject to fulfillment of the conditions as may be prescribed. If no duty is paid, the claim would not fall in Rule 18 at all. When the petitioner, through its drawback claims, claimed the refund of excise duty which was granted also, Rule 18 would have no applicability. The Supreme Court in the case of M/s Spentex Industries Ltd. [ 2015 (10) TMI 774 - SUPREME COURT ] referring to the scheme of granting rebate under Rule 18 and facilities for export of goods without payment of duty under Rules 19 of the Central Excise Rules, 2002 held that the rebate of duty paid by them on inputs as well as final product was available - This judgment thus rests on totally different facts. In fact a reversed anomaly would arise if the claim of the petitioner is accepted. If an exporter exercises option under Rule 19, he could export the goods without payment of duty. He would thereupon not be entitled to claim duty drawback on such component. On ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... er rate of drawback for the export which is available only when Cenvat facility has not been availed. In the present case, according to the Assistant Commissioner, the assessee had failed to establish that it satisfied the condition No.15 of the notification No.92/2012 dated 04.10.2012. He therefore proposed to deny the benefit of rebate of duty as claimed by the petitioner. 3. The petitioner filed a detailed reply to the said show cause notice under communication dated 21.02.2014 and principally contended that the petitioner had availed the benefit of credit of duty only on capital goods and not taken any credit on any of the inputs or input services used for manufacture of the export goods. According to the petitioner, this methodology was in conformity with the said notification dated 04.10.2012 and thus the show cause notice should be dropped. 4. Not accepting the stand of the petitioner, the Assistant Commissioner passed the order dated 05.03.2014 and rejected the rebate claim of the petitioner. He was of the opinion that the petitioner had availed the drawback at higher rate by declaring that the petitioner was not availing benefit under the Cenvat credit rules, which w ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nsel submitted that the petitioner is claiming double benefits. By virtue of claiming duty drawback, the duty paid by the petitioner earlier was neutralized. Thus, the petitioner had not borne any duty on the export goods. The question of granting rebate under such circumstances therefore would not arise. 9. Section 75 of the Customs Act, 1962 pertains to drawback. The Government of India has issued a notification dated 04.10.2012 which prescribes the rate of drawback as specified in the Schedule. Clause (6) of notes and conditions contained in the said notification reads as under:- The figures shown under the drawback rate and drawback cap appearing below the column Drawback when Cenvat facility has not been availed refer to the total drawback (customs, central excise and service tax component put together) allowable and those appearing under the column Drawback when Cenvat facility has been availed refer to the drawback allowable under the customs component. The difference between the two columns refers to the central excise and service tax component of drawback. If the rate indicated is the same in both the columns, it shall mean that the same pertains to only custom ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y free exports under Rule 19 or first pay the duty and thereafter claim rebate thereof as is provided in Rule 18. Apparently, the petitioner had claimed the rebate meaning thereby, the petitioner had paid the duty on the goods at the time of export. Perusal of Rule 18 would show that such rebate would be granted by the Central Government by issuing notification on the duty paid on excisable goods or duty paid on materials used in manufacture or processing of such goods and the rebate shall be subject to such conditions or limitations and fulfillment of such procedure as may be specified in the notification. As per this rule thus, upon export, an exporter is entitled to claim rebate on the duty paid on export goods as well as on materials used in manufacture or processing of such goods. This would of-course be subject to fulfillment of the conditions as may be prescribed. The crux of the issue in the present case is that Rule 18 recognizes the grant of rebate of duty paid on the goods. If no duty is paid, the claim would not fall in Rule 18 at all. When the petitioner, through its drawback claims, claimed the refund of excise duty which was granted also, Rule 18 would have no applic ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... de rebate only on one item in case a particular exporter/manufacturer opts for other alternative under Rule 18, namely, paying the duty in the first instance and then claiming the rebate. Giving such restrictive meaning to Rule 18 would not only be anomalous but would lead to absurdity as well. In fact, it would defeat the very purpose of grant of remission from payment of excise duty in respect of the goods which are exported out of India. It may also lead to invidious discrimination and arbitrary results. Let us visualize another situation. A particular exporter may opt for scheme under Rule 18, i.e., for claim of rebate insofar as, say, excise duty on material used in manufacture of goods is concerned. He would pay that duty and claim rebate. When it comes to payment of duty of export of excisable goods, he exercises the option under Rule 19 and executes a bond which enables him not to pay any duty on excisable goods. In this scenario, the exporter will still be able to get the benefit of not paying any excise duty on both final product as well as intermediate product. (emphasis supplied by us) 13. This judgment thus rests on totally different facts. In fact a revers ..... X X X X Extracts X X X X X X X X Extracts X X X X
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