Deemed export to a 100% EOU qualifies for Rule 5 Cenvat refund, with binding precedent prevailing over conflicting authority.

Clearances of goods from one 100% export-oriented unit to another against CT-3 were treated as physical exports for refund of unutilized Cenvat credit under Rule 5. The Tribunal followed the binding Division Bench precedent and held that deemed export to a 100% EOU qualifies for refund entitlement, and that this view prevails over a conflicting Single Judge decision. On that basis, the Revenue's objection to refund was rejected and the refund sanction was upheld.

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Issues: Whether clearance of goods to a 100% export-oriented unit against CT-3 is to be treated as export for the purpose of refund of unutilized Cenvat credit under Rule 5.

Analysis: The dispute turned on whether deemed export to another 100% EOU could be distinguished from physical export for refund under Rule 5. The Tribunal followed the binding Division Bench view that such clearances are to be treated as physical exports for the purpose of entitlement to refund of unutilized Cenvat credit. It further held that this precedent prevailed over the contrary view of a Single Judge.

Conclusion: The issue was decided in favour of the respondent and the Revenue's objection to refund was rejected.

Final Conclusion: The appeal failed and the refund sanction was upheld on the basis that deemed export to a 100% EOU qualifies for refund of unutilized Cenvat credit under Rule 5.

Ratio Decidendi: Clearances treated as deemed export to a 100% EOU are to be regarded as physical exports for entitlement to refund of unutilized Cenvat credit under Rule 5, and a Division Bench precedent governs over a conflicting Single Judge view.

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