Deemed export refund under Foreign Trade Policy upheld where nuclear project certification supported terminal excise duty claim.

Supplies qualifying as deemed exports under Chapter 7 of the Foreign Trade Policy were entitled to terminal excise duty refund where the project met the policy conditions and was supported by the required Department of Atomic Energy certification. The refusal to grant refund on the ground that the work involved construction of a bund and retaining wall was found unsustainable because the contractual documents and departmental certificates supported coverage under the deemed export framework. The impugned orders were quashed and the authority was directed to grant the refund in accordance with the policy and recommendation.

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Issues: Whether the petitioner was entitled to refund of terminal excise duty on supplies made for the nuclear project and whether the rejection of the claim under the Foreign Trade Policy was sustainable.

Analysis: The policy on deemed exports in Chapter 7 of the Foreign Trade Policy extends benefits to supplies made to eligible nuclear power projects. The materials on record showed that the project satisfied the relevant policy conditions, including the requisite certification by the Department of Atomic Energy, and the contract itself contemplated the refund benefit. The mere characterisation of the work as construction of a bund and retaining wall did not justify denial of the benefit when the supply was otherwise covered by the deemed export framework and the contractual and departmental certificates supported the claim.

Conclusion: The rejection of the terminal excise duty refund was unsustainable, and the petitioner was entitled to the refund claimed.

Final Conclusion: The impugned orders were quashed and the respondent authority was directed to grant refund of terminal excise duty in accordance with the policy and the departmental recommendation.

Ratio Decidendi: Supplies qualifying as deemed exports under the Foreign Trade Policy, and supported by the competent departmental certification required by the policy, cannot be denied the corresponding refund benefit on a purely restrictive view of the nature of the civil work involved.

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