2016 (11) TMI 316 - HC - Central Excise

High Court grants writ petition for excise duty rebate, citing outdated requirement, rules in favor of petitioner.

The High Court allowed the writ petition, directing the respondents to permit the petitioner's claim for the excise duty rebate that was previously ... Rebate of excise duty on export - procedure for filing rebate claims - requirement of bank realization certificate - administrative instructions versus published procedural manual - exercise of power under Rule 18 of the Central Excise Rules, 2002Procedure for filing rebate claims - requirement of bank realization certificate - administrative instructions versus published procedural manual - Whether denial of rebate of excise duty solely on the ground of non-submission of bank realization certificate was justified when the Central Excise Manual (updated 31.03.2005) prescribes the documents for claim and does not require a bank realization certificate. - HELD THAT: - The Court examined the documents required for filing a claim of rebate as set out in clause 8.3 of the Central Excise Manual (as updated on 31.03.2005) and noted that the listed documents do not include a bank realization certificate. Though the respondents relied on an earlier circular dated 13.11.1997 allegedly prescribing such requirement, no copy of that circular was placed before the Court nor was it shown that such an instruction remained operative vis-a -vis the 2005 Manual. Rule 18 of the Central Excise Rules, 2002 permits the grant of rebate subject to conditions and procedure as specified; the procedure in force from 2005 onwards is embodied in the Manual and does not contemplate a bank realization certificate. Therefore, denial of the petitioner's rebate solely on a ground not prescribed in the applicable procedure was unsustainable. [Paras 4, 5, 6, 7]The petition succeeds; the respondents' denial of the rebate on the sole ground of non-submission of a bank realization certificate is set aside and the respondents are directed to allow the petitioner's rebate claim.Final Conclusion: Writ petition allowed. The claim for rebate of excise duty that was disallowed solely for non-production of a bank realization certificate is to be allowed in accordance with the procedure set out in the Central Excise Manual (updated 31.03.2005). Issues:Claim of petitioner for rebate of excise duty due to non-submission of bank realization certificate.Analysis:The dispute in this writ petition revolves around the petitioner's claim for a rebate of excise duty amounting to Rs. 6,36,890, which was denied solely due to the non-submission of a bank realization certificate. Initially, the Deputy Commissioner passed an order informing the petitioner had fulfilled all submission requirements except for the realization certificate, leading to the denial of the rebate. Despite subsequent appeals and a revision, the denial persisted based on the absence of the said certificate.The central point of contention raised by the authorities is the non-filing of the bank realization certificate, which they argue as the basis for disallowing the rebate claim. The Central Excise Manual, as presented in the writ petition, outlines the necessary documents for claiming a rebate, including a request on the exporter's letterhead, A.R.E. 1 numbers, original copies of relevant documents, and a disclaimer certificate if applicable.The respondent's counsel referred to a circular from 1997 mentioning the requirement of a bank realization certificate. However, the absence of this circular in the record and the publication of the Excise Manual in 2005 without such a requirement raise doubts about its current validity. Additionally, the petitioner's counsel cited a Bombay High Court judgment emphasizing that the procedure outlined in the Excise Manual post-2005 does not include the necessity of a bank realization certificate for claiming rebates under Rule 18 of the Central Excise Rules 2002.Considering the arguments presented, the High Court allowed the writ petition, directing the respondents to permit the petitioner's claim for the excise duty rebate that was previously disallowed. The judgment emphasizes the inconsistency in denying the claim based on a requirement that was not applicable from 2005 onwards as per the updated Excise Manual, thus ruling in favor of the petitioner.