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of <h1>Interpretation of duty rates for exported electric cars sans batteries</h1> <h3>IN RE: REVA ELECTRIC CAR COMPANY PVT. LTD.</h3> IN RE: REVA ELECTRIC CAR COMPANY PVT. LTD. - 2012 (275) E.L.T. 488 (G. O. I.) Issues:1. Interpretation of Notification No. 6/2002-C.E., dated 1-3-2002 regarding concessional rate of duty for electric cars.2. Correctness of duty payment for exported cars not fitted with electrical batteries.3. Applicability of rebate on excess duty paid.4. Compliance with C.B.E.C. Circular No. 510/06/2000-CX., dated 3-2-2000.5. Treatment of excess duty paid as a voluntary deposit.Issue 1: Interpretation of Notification No. 6/2002-C.E., dated 1-3-2002The case involved determining whether electric cars exported without batteries fitted were eligible for the concessional rate of duty under Notification No. 6/2002-C.E., dated 1-3-2002. The adjudicating authority found that such vehicles, designed to run solely on electrical energy, were eligible for the concessional rate of duty specified in the notification. The government agreed with this finding, emphasizing that the vehicles would operate on batteries when in use, supporting their eligibility for the concessional rate.Issue 2: Correctness of duty payment for exported carsThe Assistant Commissioner initially sanctioned a cash rebate for the duty paid at the concessional rate of 8% BED for the exported cars not fitted with batteries. However, the Commissioner (Appeals) allowed a cash rebate for the total duty paid by the applicant. The government observed that any amount paid in excess of the effective duty rate could not be considered as duty and should be treated as a deposit with the government, to be returned in the manner it was paid. The excess duty paid was rightly ordered to be returned as re-credit in the Cenvat Credit account by the original authority.Issue 3: Applicability of rebate on excess duty paidThe applicant department contested the impugned order-in-appeal, arguing that the excess amount paid in duty, over the concessional rate, could not be refunded in cash. The respondent party maintained that the entire duty paid should be rebated, citing C.B.E.C. Circular No. 510/06/2000-CX., dated 3-2-2000. The government agreed with the respondent, stating that the whole duty of excise paid should be rebated, as per the circular.Issue 4: Compliance with C.B.E.C. Circular No. 510/06/2000-CX., dated 3-2-2000The government noted that the duty assessing Assistant Commissioner, who sanctioned the rebate, was the same officer as the jurisdictional Assistant Commissioner, as per the circular. Therefore, there was no violation of the circular in the decision-making process.Issue 5: Treatment of excess duty paid as a voluntary depositThe government referred to a High Court order which stated that any amount paid in excess of duty liability, voluntarily, should be treated as a deposit with the government and returned to the respondent in the manner it was paid. The government applied this principle to the case, setting aside the impugned order-in-appeal and allowing the revision application for the excess amount paid to be returned as re-credit in the Cenvat Credit account.This comprehensive analysis highlights the key legal interpretations, duty payment correctness, rebate applicability, circular compliance, and treatment of excess duty paid in the judgment.
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