2015 (1) TMI 631 - CGOVT - Central Excise

Government upholds rejection of rebate claim by Welspun Trading Ltd. for post-amendment exported goods

M/s Welspun Trading Co., Kutchh Versus CCE, Rajkot

The Government upheld the decision to reject the rebate claim by M/s Welspun Trading Ltd. as the goods were exported after the amendment of Notification ... Denial of rebate claim - Area based exemption - Goods exported after Notification No.19/04-CE(NT) dated 6.9.04 was amended vide Notification No.37/07-CE(NT) dated 17.9.07 by inserting condition (h) in para 2 of said Notification. The said clause (h) specifically stipulates that rebate shall not be admissible under this Notification if manufacturer has availed the benefit of various areas based exemption Notification including Notification No.39/01-CE(NT) dated 31.7.2001 - Held that:- Goods were exported on 4.10.07 when the amended Notification No.19/04-CE(NT) was effective. In this case goods were manufactured by a manufacturer who has availed benefit of Notification No.39/01-CE(NT) dated 31.7.01 and as per clause (h) of para 2 of Notification No.19/04-Ce(NT) inserted vide Notification No.37/07-CE(NT) dated 17.9.07, in such case rebate shall not be admissible. The ratio of above said GOI Revision Order No.576/12-Cx dated, 18.5.12 is squarely applicable to this case. It is pertinent to mention that said GOI order dated 18.5.12 was upheld by Hon’ble High Court of Gujarat vide order [2013 (5) TMI 378 - GUJARAT HIGH COURT] filed by M/s Welspun Corp. Ltd. - rebate claim in the instant case is rightly held as inadmissible by the lower authorities. Government do not find any infirmity in the said order-in-appeal and therefore upholds the same. - Decided against Assessee. Issues Involved:1. Rebate claim for duty paid on exported goods.2. Applicability of amended Notification No.37/2007-CE(NT) dated 17.09.2007.3. Retrospective effect of the amended notification.4. Definition of 'relevant date' under Section 11B of the Central Excise Act, 1944.5. Procedural vs. substantive rights under Section 11B and Rule 18 of Central Excise Rules, 2002.Issue-wise Detailed Analysis:1. Rebate claim for duty paid on exported goods:The applicant, M/s Welspun Trading Ltd., filed a rebate claim for Rs. 50,41,536/- paid on goods cleared for export in September 2007. The claim was initially rejected by the original authority and upheld by the Commissioner (Appeals) on the grounds that the goods were exported after the amendment of Notification No.19/04-CE(NT) by Notification No.37/07-CE(NT), which inserted condition (h) disallowing rebate if the manufacturer availed the benefit of Notification No.39/01-CE.2. Applicability of amended Notification No.37/2007-CE(NT) dated 17.09.2007:The applicant contended that the amended Notification No.37/07-CE(NT) should not apply to goods cleared for export before 17.09.2007, as the amendment was not in force at the time of clearance. However, the Government observed that the goods were exported on 04.10.2007, when the amended notification was effective. Therefore, the rebate claim was inadmissible as per the amended notification.3. Retrospective effect of the amended notification:The applicant argued that the amended notification did not have retrospective effect and should not apply to goods cleared before 17.09.2007. The Government noted that the entitlement to rebate arises upon the export of goods, not their clearance from the factory. Since the goods were exported after the amendment, the conditions of the amended notification applied, making the rebate claim inadmissible.4. Definition of 'relevant date' under Section 11B of the Central Excise Act, 1944:The applicant disputed the Commissioner (Appeals)' interpretation of the 'relevant date' as the date the ship leaves India. They argued that the relevant date is for computing the time limit for filing the refund claim, not for determining eligibility. The Government upheld the view that the relevant date pertains to the export date, which affects the applicability of the amended notification.5. Procedural vs. substantive rights under Section 11B and Rule 18 of Central Excise Rules, 2002:The applicant claimed that Section 11B is procedural and does not affect the substantive right to claim a rebate under Rule 18. The Government emphasized that Rule 18, read with Notification No.19/04-CE(NT), requires compliance with conditions and limitations at the time of export. Since the goods were exported after the amendment, the rebate was not admissible.Conclusion:The Government upheld the lower authorities' decision, rejecting the rebate claim as the goods were exported after the amendment of Notification No.19/04-CE(NT) by Notification No.37/07-CE(NT), which disallowed rebate for goods manufactured under Notification No.39/01-CE. The revision application was rejected as devoid of merit.