2014 (12) TMI 30 - CGOVT - Central Excise

Revision application denied for rebate claim; excess duty paid not eligible. Cenvat credit account re-credit subject to compliance.

IN RE : SUMITOMO CHEMICALS INDIA PVT. LTD.

IN RE : SUMITOMO CHEMICALS INDIA PVT. LTD. - 2014 (308) E.L.T. 198 (G. O. I.) Issues:- Rejection of part rebate claim by Deputy Commissioner of Central Excise- Appeal rejection by Commissioner (Appeals)- Revision application filed before Central GovernmentAnalysis:1. The revision application was filed by M/s. Sumitomo Chemicals India Pvt. Ltd., a merchant exporter, against the rejection of a part rebate claim of Rs. 2,03,514 by the Deputy Commissioner of Central Excise. The rejection was based on the grounds that the duty paid on the FOB value was rebateable under Rule 18 of Central Excise Rules, 2002.2. The applicant appealed before the Commissioner (Appeals) after being aggrieved by the rejection. However, the appeal was also rejected, leading the applicant to file a revision application under Section 35EE of the Central Excise Act, 1944 before the Central Government.3. The applicant's grounds for the revision application included arguments that the duty was paid on the assessable value indicated in the ARE-1, not for the payment of excise duty, and that excess duty paid should be allowed as rebate based on Board Instructions and relevant rules.4. The Government noted that the applicant filed rebate claims totaling Rs. 51,61,636 for duty paid on exported goods. The duty was paid on the CIF value, and the FOB value was determined as the transaction value, leading to the rejection of the part claim of Rs. 2,03,514 for excess duty paid.5. The Government observed that the determination of the value of excisable goods involved various statutory provisions, including Section 4 of the Central Excise Act, 1944, which defines the transaction value based on the relationship between the assessee and the buyer, among other factors.6. The Government further analyzed the concept of 'place of removal' as defined under Section 4(3)(c) of the Act, emphasizing that the place of removal must be within the geographical limits of India. The judgment in the case of CCE v. M/s. Bhagirth Textiles Ltd. supported the idea that duty is not to be paid on the CIF value.7. The Government referred to Supreme Court judgments and CBEC Circulars to clarify the valuation of excisable goods and the determination of assessable value at the place of removal. The Circulars emphasized the transaction value under Section 4 of the Act and the eligibility for rebate of whole duty paid on excisable goods.8. In conclusion, the Government noted that duty was paid on the CIF value, and the excess duty paid on the portion beyond the transaction value was rightly denied as rebate. The applicant's request for re-credit in the Cenvat credit account was considered, subject to compliance with the provisions of the Central Excise Act, 1944.9. The revision application was disposed of based on the above analysis, and the order was issued accordingly.