Cenvat credit refund for supplies to a 100% EOU treated as export, with binding precedent controlling the result.

Supplies to a 100% Export Oriented Unit were treated as exports for the purpose of refund of accumulated unutilised Cenvat credit under Rule 5, following binding jurisdictional precedent. The contrary view based on deemed export was rejected, and subordinate authorities were held unable to ignore a binding High Court ruling merely because it arose in another assessee's matter. The amended definition of export was noted as relevant only for the later period and not for the period in dispute. Refund of Cenvat credit was therefore admissible, and the rejection of the claim was unsustainable.

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Issues: Whether refund of accumulated Cenvat credit under Rule 5 was admissible where inputs were used in the manufacture of final products supplied to a 100% Export Oriented Unit, treating such supply as export.

Analysis: The decision followed the binding jurisdictional precedent which had already held that clearances made to a 100% EOU are to be treated as physical exports for the purpose of refund of unutilized Cenvat credit. The contrary view based on deemed export was rejected, and it was held that lower adjudicating authorities cannot disregard binding decisions of the jurisdictional High Court merely because the earlier ruling arose in another assessee's case. The amended definition of export was noted as indicating a different position only for the later period, and not for the period in dispute.

Conclusion: Refund under Rule 5 was admissible to the assessee for supplies made to a 100% EOU, and the impugned rejection was not sustainable.

Final Conclusion: The appeal succeeded and the assessee was held entitled to the refund claimed under the applicable Cenvat credit scheme.

Ratio Decidendi: Supplies to a 100% EOU are to be treated as exports for refund of unutilized Cenvat credit under Rule 5, and binding jurisdictional precedent must be followed by subordinate authorities.

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