TaxTMI 
TaxTMI 
2023 (10) TMI 1086
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....They are holding registration as a 100% EOU till 13/3/2012 and cleared their goods for export as well as to DTA on payment of duty. Consequent upon MEPZ Final Exit Order dated 13/3/2012, they surrendered EOU status and obtained an amended registration for functioning as DTA unit. They applied for NOC to exit from EOU status. They have procured raw materials on payment of duty and availed CENVAT credit of the same. After exit from EOU, the appellant carried forward the CENVAT credit lying in their balance to the DTA Unit. The department was of the view that the status of the EOU unit is different from DTA unit and as there is no change of ownership as contemplated under Rule 10 of CENVAT Rules 2004, the credit cannot be carried forward. Furt....
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....U Unit can be transferred to the DTA Unit after exit of EOU status. As per Rule 10 if a manufacturer shifts the factory to another site or the factory is transferred on account of change in ownership or on account of sale, merger, amalgamation, lease or transfer of the factory to a joint venture then the manufacturer is allowed to transfer the CENVAT credit lying un-utilised in its accounts to the Unit that is sold, merged, leased or amalgamated. In the present case, the Unit has become a DTA after exiting from EOU status. Under Central Excise law both these units are considered as separate entities. The accumulated credit cannot be denied to both the units and the department cannot recover such credit which belongs to the appellant. The is....
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....in case law cited by the appellant in support is GTN Exports Ltd. v. CCE (supra) decided by the CESTAT, Chennai. In this case CESTAT allowed an EOU to take the credit of its predecessor domestic tariff area unit (DTA unit) citing that Rule 10 of Cenvat Credit Rules did not prohibit availment of such credit at the time of conversion of DTA to EOU. By applying the same rational we are unable to understand how the department would prohibit an EOU, when it is converting itself to a DTA scheme, to take the credit of the balance credit lying with the predecessor EOU. There is no logic and rational in the department's contention that Rule 10 of Cenvat Credit Rules, 2004 does not cover such a situation. The CESTAT Chennai's decision in GTN Exports ....
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....ther domestic manufacturers of export goods through other neutralization provisions. The scheme for which exemptions are notified under the tax laws is, thus, a facilitating measure that may, according to their commercial judgment, be accessed by the holders of 'letter of permission' under the scheme without any compulsion to avail the exemption. The alternative of other neutralization facilities are not, therefore, excluded to such holders. 6. Whether holding the title to those privileges or not, all manufacturers, other than those operating outside the 'customs territory', are registered under the Central Excise Act, 1944 and subject to the same excisability under Central Excise Act, 1944. The administration of the registration system d....
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.... that is contained in the Cenvat Credit Rules, 2004. 8. As pointed out in the impugned order, the provisions of Rule 10 or Rule 11 will not apply to debonding units. It is also patently clear that a similar provision has not been explicitly incorporated in the Cenvat Credit Rules, 2004 for such debonding units. At the same time, Rule 5 of Cenvat Credit Rules, 2004 entitle exporting units, including '100% export oriented units', to claim refund of such accumulated credit at periodic intervals. Non-recourse to this privilege does not exclude them from entitlement to such. It may also be worth noting that the eligibility for refund is contingent only upon inability to utilize the accumulated credit for discharge of duty liability on clearanc....