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Issues: Whether DEPB credit was to be calculated on FOB value of exports, subject to the restriction that it should not exceed 50% of the present market value.
Analysis: The Commissioner (Appeals) had allowed DEPB credit on FOB value while restricting the entitlement to 50% of the present market value. That view was in line with the departmental circular and the clarifications issued by DGFT, which stated that credit entitlement would not exceed 50% of the actual present market value. Since the appellate order conformed to the governing circular and clarifications, no legal infirmity was found in it.
Conclusion: The issue was answered in favour of the assessee and against the Revenue.
Final Conclusion: The appeal failed because the impugned order correctly applied the governing policy and circular framework on computation of DEPB credit.
Ratio Decidendi: Where the applicable circular and contemporaneous clarifications prescribe that DEPB credit is computed on FOB value but capped at 50% of the present market value, an appellate order following that formula cannot be disturbed.
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