SEZ Developers' Supplies Treated as Exports: Tribunal Grants Relief

The Tribunal set aside the duty demand on goods supplied to SEZ Developers under Rule 6 of Cenvat Credit Rules 2004, ruling in favor of the appellants. It held that supplies to SEZ Developers should be treated as exports of dutiable goods, entitling the appellants to corresponding benefits. The decision aligned with precedents and guidelines, clarifying the availability of Cenvat credit for inputs used in products supplied to SEZ Developers. The appellants were granted relief, emphasizing the treatment of such supplies as exports and establishing their entitlement to associated benefits.

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Issues:
Appeal against duty demand on goods supplied to SEZ Developers under Rule 6 of Cenvat Credit Rules 2004.

Analysis:
The appellants challenged an order confirming duty demand on goods supplied to SEZ Developers under Rule 6 of Cenvat Credit Rules 2004. The Revenue contended that goods cleared without duty payment to SEZ Developers should not be treated as exports, and the appellants must pay 10% of the goods' price cleared at nil duty rate. The Revenue relied on guidelines from the Ministry of Commerce & Industry, Department of Commerce, dated 3-4-2008, stating that Cenvat credit is not available for inputs used in finished products supplied to SEZ Developers under Rule 6(6) of the Cenvat Credit Rules 2004. The Revenue argued that precedents like Sujana Metal Products Ltd. v. Commissioner of C.Ex., Hyderabad and Surya Roshni Ltd. v. Commissioner of Central Excise, Rohtak were not applicable to the case.

The Tribunal considered the issue previously addressed in Sujana Metal Products Ltd. case, where it was ruled that supplies to SEZ Developers should be treated as exports of dutiable goods, entitling the appellants to corresponding benefits. The Tribunal noted that the decision in Sujana Metal Products Ltd. case covered the current issue, as it clarified that supplies to SEZ Developers are to be treated as exports of dutiable goods. Consequently, the Tribunal found no merit in the impugned order and set it aside, allowing the appeal with any consequential relief.

This judgment highlights the interpretation of Rule 6 of the Cenvat Credit Rules 2004 concerning duty demand on goods supplied to SEZ Developers. It emphasizes the treatment of such supplies as exports of dutiable goods, aligning with precedents and guidelines from the Ministry of Commerce & Industry. The ruling provides clarity on the availability of Cenvat credit for inputs used in products supplied to SEZ Developers and establishes the entitlement of appellants to benefits associated with treating such supplies as exports.

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