Deemed export relief allows terminal excise duty credit for DTA suppliers after GST transition, subject to policy conditions.

A DTA supplier making deemed exports to an EOU or EPCG licence holder is entitled to terminal excise duty relief under the Foreign Trade Policy if the policy conditions are met, including the bar on CENVAT credit or rebate and any required disclaimer. A circular relied on by the authorities could not override that substantive entitlement. Because the duty had in fact been paid and the matter arose in the GST transition, the relief was required to be worked out through credit in the electronic credit register rather than by cash refund. The rejection orders were set aside and credit was directed to be granted within the stipulated time.

---

---

Issues: Whether a supplier of goods to an EOU or EPCG licence holder is entitled to refund of terminal excise duty, and whether the amount, if already paid, can be granted as credit in the petitioner's electronic credit register.

Analysis: The entitlement under the Foreign Trade Policy was held to accrue to the DTA supplier as part of the deemed export scheme, subject to the policy conditions, including the bar against availment of CENVAT credit or rebate and the requirement of the necessary disclaimer where applicable. The policy circular relied on by the authorities could not override the substantive entitlement recognised under the policy. The Court further noted that the petitioner had in fact paid the duty and that the post-GST regime required the relief to be worked out by credit rather than cash refund, in line with the approach adopted in the governing precedent.

Conclusion: The petitioner was held entitled to relief, and the impugned orders rejecting the claims were set aside.

Final Conclusion: The writ petitions were allowed and the authorities were directed to grant credit of the duty amount in the petitioner's electronic credit register within the stipulated time.

Ratio Decidendi: A supplier making deemed exports under the Foreign Trade Policy is entitled to terminal excise duty relief if the policy conditions are satisfied, and after the transition to GST the relief may be worked out through credit where cash refund is not the permissible mode.

---