2016 (6) TMI 1205 - AT - Customs

Tribunal remands matter for fresh consideration on brand rate of drawback application

M/s. Amber Enterprises India Pvt. Ltd Versus C.C.E. & S.T. -Dehradun

The Tribunal allowed the appeal by remanding the matter for fresh consideration by the original authority concerning the fixation of brand rate of ... Duty drawback - rejection of application for fixation of brand rate of drawback - Rule 7 of the Customs, Central Excise Duties and Service Tax Drawback Rules, 1995 - delay in filing application - Held that: - the issue is covered by the decision of the Tribunal in the case of Amber Distilleries Ltd. Vs. CCE Thane-I [2016 (4) TMI 1197 - CESTAT MUMBAI], wherein it has been held that drawback being beneficial legislation need consideration in broader perspective and not in narrow compass and provision for condonation of delay up to 12 months in not filing brand rate application within three months, requires to be implemented in correct perspective - the application for fixation of brand rate in the present case needs to be considered by condoning the delay. Rejection also on the ground that failure to declare figure 9801 as an identifier in the Shipping Bill under Drawback details - Held that: - the Hon’ble High Court of Bombay on the very issue in the case of Alfa Laval (India) Ltd. Versus Union of Inida [2014 (9) TMI 145 - BOMBAY HIGH COURT] has held that the C.B.E. & C. while clarifying the Rules, cannot impose limitations/restrictions thereon, which are clearly not provided for in the Rules, and accordingly, has the effect of whittling down the Rules, and that in the grab of clarification, the C.B.E. & C. cannot incorporate a restriction/limitation which did not find a place in the Rules - there is no bar to claim brand rate even if AIR has been claimed. Matter is remanded to the original authority for fresh consideration - appeal allowed by way of remand. Issues involved:Fixation of brand rate of drawback under Rule 7 of the Customs, Central Excise Duties and Service Tax Drawback Rules, 1995.Detailed Analysis:1. Background and Facts: The appellant, engaged in manufacturing Air Conditioners, availed area-based exemption of Excise duty under a specific notification and did not avail Cenvat Credit on inputs. They received an export order and made the first export without excise duty payment, utilizing inputs procured domestically with paid excise duty and no Cenvat credit.2. Drawback Rate Discrepancy: The export of Air Conditioners fell under the All Industry Rate of Drawback Schedule, with a fixed drawback rate irrespective of Cenvat facility usage. The appellant, finding the rate lower than actual duties, applied for Brand Rate fixation under Rule 7 of the Drawback Rules.3. Application Process: Initially, the appellant mistakenly applied for Brand Rate fixation to the wrong authority but later corrected it by applying to the correct jurisdictional Central Excise Commissionerate along with an extension request as per Rule 7.4. Rejection by Commissioner: The Commissioner rejected the application citing non-compliance with Rule 7 provisions and other related notifications and circulars, deeming the appellant ineligible for Duty Drawback.5. Condonation of Delay: The appellant sought condonation of delay in the application process, referencing a Tribunal decision emphasizing the broader perspective of considering drawback applications and the provision for condoning delays up to 12 months.6. Shipping Bill Declaration: The issue of not declaring a specific identifier in the Shipping Bill was addressed by referring to a High Court judgment emphasizing that Circulars cannot impose restrictions beyond what the Rules specify, and the appellant could still claim brand rate even if All Industry Rate had been claimed.7. Tribunal Decision: The Tribunal set aside the rejection order, remanding the matter for fresh consideration by the original authority in light of the observations made regarding the application process, delay condonation, and Shipping Bill declaration.8. Operative Portion: The appeal was allowed by way of remand, indicating that the decision was pronounced in open court for further action based on the Tribunal's directions.