Rebate under excise rules follows duty actually paid, and Modvat account source does not alter entitlement.

Rebate under the Central Excise Rules is governed by the duty actually paid on exported goods and inputs, not by the duty that ought to have been paid; even payment through an erroneous higher debit or from the Modvat account does not change rebate entitlement. On the jurisdictional point, where the dispute was treated as one concerning recovery of utilised Modvat credit, the matter was held to fall within the Tribunal's appellate jurisdiction rather than being restricted to a revision route. The impugned order was therefore set aside and the assessee's challenge succeeded.

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Issues: (i) Whether rebate under the excise rules is confined to the duty actually paid on exported goods and inputs, even if the amount paid was in excess of the duty payable; (ii) Whether the appeal was maintainable before the Tribunal in view of the objection that the proper appellate forum was the revisional authority.

Issue (i): Whether rebate under the excise rules is confined to the duty actually paid on exported goods and inputs, even if the amount paid was in excess of the duty payable.

Analysis: Rule 12 of the Central Excise Rules refers to rebate of duty paid on excisable goods and duty paid on materials used in manufacture, and not to duty payable. The governing principle is that rebate follows the actual duty paid, whether payment was made at a correct rate or through an erroneous higher payment. The source of payment, whether from PLA or Modvat account, does not alter the character of the payment for rebate purposes.

Conclusion: Rebate was admissible on the duty actually paid, and the excess debit adjustment was not sustainable.

Issue (ii): Whether the appeal was maintainable before the Tribunal in view of the objection that the proper appellate forum was the revisional authority.

Analysis: The proceedings below proceeded on the basis that excess Modvat credit had been utilised and the impugned orders sought recovery of Modvat credit. On that footing, the matter fell within the Tribunal's appellate jurisdiction rather than being confined to a rebate revision route.

Conclusion: The appeal was maintainable before the Tribunal.

Final Conclusion: The impugned order was set aside and the assessee's challenge succeeded in full.

Ratio Decidendi: Rebate under the excise rebate rule is governed by the duty actually paid on the exported goods and inputs, not by the duty that ought to have been paid, and the mode or account from which payment is made does not affect rebate entitlement.

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