Cenvat credit can be used for export duty payment, and rebate cannot be denied solely because credit arose from other clearances.

Rebate of duty on exported goods remains admissible where an assessee operates under two exemption notifications, maintains separate records as required by the departmental circular, and uses accumulated Cenvat credit to pay duty on the exported final products. The governing rules permit Cenvat credit to be used for payment of duty on any final product, and the source of the credit does not by itself defeat rebate merely because the credit arose from inputs used in other clearances. Where no credit was taken on the relevant inputs and duty on export clearances was paid under the Cenvat scheme, the rebate claim is maintainable.

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Issues: Whether rebate of duty paid on exported goods was admissible where the assessee operated simultaneously under two exemption notifications, maintained separate records, and utilized accumulated Cenvat credit for payment of duty on the exported final products.

Analysis: The governing provision permitted Cenvat credit to be utilized for payment of duty on any final product. The record showed that the assessee maintained separate accounts for clearances under the two notifications as required by the departmental circular. The objection that the credit used for export duty payment had accrued on inputs used in other goods was not sufficient to deny rebate, because the Rules did not restrict utilization of credit to the very goods in which the inputs were consumed. The exemption condition relied upon by the department did not alter the position on the facts found, since no credit had been taken on the inputs used for the cotton yarn cleared under the relevant notification and the duty on export clearances was paid in accordance with the Cenvat scheme.

Conclusion: Rebate was admissible and the departmental challenge failed.

Final Conclusion: The impugned appellate order was sustained and the revision was rejected, leaving the assessee entitled to the rebate claimed.

Ratio Decidendi: Cenvat credit may be utilized for payment of duty on any final product, and rebate cannot be denied merely because the credit balance arose from inputs used in different clearances, so long as the statutory and circular requirements applicable on the facts are satisfied.

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