export of bought outt items as such without reversal of cenvat credit-applicability of the decision of supreme court {ELT 295(353)}

[VINOD KUMAR]

Dear experts,

A manufacturer has exported 'bought out items as such' without payment of duty and without reversal of credit. It is neither their input nor capital goods. Further, it has not been used in manufacturing process and has been cleared as such like a traded item.

My query is (1) Whether the decision of Supreme Court in KCP Ltd. Vs CCE Chennai {ELT 295 (353) = 2013 (9) TMI 98 - SUPREME COURT   is applicable in above case i.e. reversal of Cenvat credit on bought out items (2) Whether Rule 6 (3D)(c) of CCR 2004 applicable.

The above case is special case as in all other 3 cases of export without payment of duty i.e. (1) CT-1 procedure under bond (2) LUT procedure and (3) Annexure-45 procedure under Notf No. 43/2001-CE(NT), only the original manufacture gets both the benefits of (1) non-reversal of Cenvat credit and (2) Export without payment of duty. Whereas, in above case a trader is getting the above benefits.

[MUKUND THAKKAR]

Dear Karan,

if you are manufacturer and want to export bought out items you can first you export and file refund. in your case above mention case is not applicable which is totally different to your doubt.

AI Summary

Cenvat credit reversal on exported bought out items: export and claim refund when items were not used in manufacture. Where a manufacturer exports bought out items as such that were not used in manufacture, the advised administrative approach is to export and file a refund claim; the cited Supreme Court authority was considered inapplicable because it addresses different factual circumstances where the exporter is the original manufacturer and the items formed part of the manufacturing process, so applicability of credit reversal provisions depends on factual alignment with established export procedures.