cenvat credit on re-imported goods

[sv bhasker]

A manufacturer has exported goods through merchant exporter. However, due to quality problems, goods are re-imported by the merchant exporter after paying of applicable customs duties for sending back to original manufacturer. Bill of entry is in the name of merchant exporter, who is not registered with CE dept for passing on cenvat credit.. Please advise with suitable circulars, case laws as to how credit  of the customs  duty paid can be taken by the manufcaturer in the above situation.

Regards.

AI Summary

Cenvat credit on re-imported goods: import duty paid on re-import may be claimable as input credit with documentary proof.
Cenvat credit on re-imported goods depends on whether duty was paid at removal and on duties paid on re-import. Rule 16 permits re-introduction of duty-paid goods for repair or remaking and allows cenvat credit based on duty-paying documents; manufacture arising from processing triggers excise on assessable value, otherwise an amount equal to credit must be paid. Exports under bond/LUT (no duty at removal) fall outside Rule 16; if import duty is paid on re-import, that duty can be claimed as cenvat credit subject to documentary proof, while Rule 16 does not grant credit for import duty where repair is not manufacture.