SKAPS INDUSTRIES PVT. LTD. Vs. COMMISSIONER OF C. EX., AHMEDABAD-II
LAWS(CE)-2015-7-75
CUSTOMS EXCISE AND GOLD(CONTROL) APPELLATE TRIBUNAL
Decided on July 17,2015

Skaps Industries Pvt. Ltd. Appellant
VERSUS
Commissioner Of C. Ex., Ahmedabad -Ii Respondents

JUDGEMENT

H.K.THAKUR,MEMBER (T) - (1.)These appeals have been filed by the appellant with respect to OIA No. 124/2009 (Ahd -II)/CE/ID/Commr(A)/Ahd, dated 19 -3 -2009 in which Commissioner (Appeal) has allowed the appeal filed by the Revenue against refund of Rs. 10,02,301 sanctioned by Adjudicating Authority under OIO No. 1069/R/2008, Dated 26 -5 -2008. Shri Hardik Modh (Adv.) and Shri Arjun Akruwala (CA) appeared on behalf of the appellant. Shri Hardik Modh (Adv.) argued that appellant is a 100% EOU taking Cenvat credit on the inputs used when the exports are made under board without payment of duty on the finished products. It was his case that as a result of export of finished goods accumulated in the Cenvat Account is refundable under Rule 5 of the Cenvat Credit Rule, 2004 (CCR). Learned advocated made the Bench go through para -10 of the OIA No. 124/2009 (Ahd -II)/CE/ID/Commr(A)/Ahd, dated 19 -3 -2009, passed by the first appellate authority, to argue that Commissioner appeals has taken a view that certain DTA clearance have been shown in the returns of relevant periods which means that appellant is capable of utilizing unutilized credit for clearance of finished goods in DTA. He made the bench go through ER -2 returns filed to argue that slit Yarn Waste and Fabric Waste/Seconds, amounting to Rs. 93,397 were cleared in DTA on payment of duty as the same could not be exported. It was also his case that if certain goods are cleared in DTA then that fact cannot be made the basis of rejecting refund claims of cumulative Cenvat credit on exports under Rule -5 of CCR.
(2.)Shri J. Nair (Authorised Representative) appearing on behalf of the Revenue defended the order passed by the appellate authority. Heard both sides and perused the case records. A refund claim of Rs. 10,02,301 filed by the appellant under Rule -5 of CCR was sanctioned by the Adjudicating Authority under OIO Dated 26 -5 -2008. However, on departmental review the same was set aside by the first appellate authority under OIA No. 124/2009 (Ahd -H)/CE/ID/Commr(A)/Ahd, Dated 19 -3 -2009 against which the present appeal is filed. The only grounds taken by the first appellate authority is that unutilized credit could have been utilized for DTA clearances being made by the appellant. However, there is no such restriction under Rule -5 of CCR and he refund notification issued thereunder. It is apparent from the case records that certain waste/rejects of the Yarn and Fabrics are only cleared in DTA which cannot be exported. If the stand of the department is accepted then no refund will be admissible to an exporter because every manufacture will result into generation of some waste and scrap which has to be cleared in DTA. In view of the above observations appeal filed by the appellant is allowed with consequential relief, if any.
(Operative portion of the order pronounced in Court)

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