SEZ supplies treated as exports: Rule 6 Cenvat restrictions did not apply, preserving exemption benefit for intermediate goods.

Supplies of intermediate goods to an SEZ unit were treated as exports under Section 2(m) of the SEZ Act, with Section 51 giving the Act overriding effect over inconsistent provisions. On that basis, such clearances were not exempted goods and were not chargeable to nil duty under an exemption notification under Section 5A(1) of the Central Excise Act, so Rule 6(1), Rule 6(2) and Rule 6(3) of the Cenvat Credit Rules, 2004 did not apply. The intermediate goods used to manufacture final products supplied to the SEZ unit therefore qualified for Notification No. 67/95-CE, and the duty demand, interest and penalties were not sustainable.

---

---

Issues: Whether intermediate products cleared to a unit in the Special Economic Zone without payment of duty were entitled to exemption under Notification No. 67/95-CE and whether such clearances could be treated as exempted goods for the purpose of Rule 6 of the Cenvat Credit Rules, 2004.

Analysis: The dispute was covered by the Tribunal's earlier decision in the appellant's own case. Supplies made to an SEZ or SEZ developer are treated as exports by virtue of Section 2(m) of the Special Economic Zones Act, 2005, and the overriding effect of Section 51 of that Act prevails over inconsistent provisions. As such supplies are not exempted goods and are not chargeable to nil rate of duty under an exemption notification issued under Section 5A(1) of the Central Excise Act, 1944, Rule 6(1), Rule 6(2) and Rule 6(3) of the Cenvat Credit Rules, 2004 do not apply. The earlier ratio was followed to hold that the intermediate goods used in the manufacture of final products supplied to the SEZ unit qualified for the benefit claimed.

Conclusion: The benefit of Notification No. 67/95-CE was available to the appellant, and the duty demands, interest and penalties could not be sustained.

---