TaxTMI 
TaxTMI 
2013 (8) TMI 7
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....pping bills through CHA M/s. Velji Dosabhai & Sons Pvt. Ltd., (hereinafter referred to as "CHA") under the claim of duty drawback for export of goods viz. Cotton made-ups, including quilted cotton made-ups with or without embroidery and with or without metalized yarn, 100% cotton flat sheets and pillow cases of different sizes. 2.1 The applicant (Sr. No. 1) vide their letters dated 26-2-2008 submitted drawback claims/applications along with supplementary claim under Annexure-III due to increase in drawback rates for the amount of duty drawback of Rs. 3,70,832/-. The adjudicating authority during scrutiny found that the duty drawback actually admissible to the exporters is Rs. 81,502/- as against their claim of higher amount of drawback, which he has alleged, were claimed fraudulently by them. Further, it was alleged that (i) the exporters also managed to furnish the 'forged certificate' certifying that the said Unit was not availing Cenvat credit; (ii) that Shri Gyansingh P. Sisodiya, Authorized Signatory, (hereinafter referred to as "appellant-02") of the Exporter, who is looking after the liaisoning work, such as monitoring and follow-up of duty drawback claims and legal ....
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....applicant M/s. Texcellance Overseas filed appeals before Commissioner (Appeals) who vide instant Order-in-Appeal Nos. 106-108/Commr.(A)/JMN/2011 dated 22-9-2011 has observed that there is a difference between availment of CENVAT credit by a unit manufacturing export product and availment of CENVAT credit in respect of the inputs and input services in respect of 'export goods' for which the drawback is claimed. Further, except the statement that allegedly a forged certificate dated 4-3-2008 was produced, there is nothing on record to substantiate or prove that it was actually forged, and that such alleged forgery had material impact on drawback admissibility. Though, the respondents have denied of producing the same to the Pipavav Custom House, but still, it has been presumed without conducting any further investigation, that only exporter could have submitted such 'forged' certificate. Thereby, stating that such presumptions cannot be accepted. 3.1 Further by going to the relevant Condition No. 05 and 12 of Notification No. 81/2006-Customs (N.T.), dated 13-7-2006 and Notification No. 68/2007-Customs (N.T.), dated 16-7-2007 which determines the All Industry Rates for Drawbac....
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.... vide impugned order dated 31-12-2010, the department had rejected the genuine claim of duty drawback of the appellant without any cogent and proper reasons. The appellant submits that the department rejected the claim of the appellant on the ground that the appellant was availing the benefit of the CENVAT credit during the specified period and therefore the appellant is not entitled to dual benefit. 4.1.2 The appellant submits that the adjudicating authority observed that the certificates dated 3-3-2008 and 4-3-2008 has been issued by the department only saying that the appellant has not taken benefit of CENVAT credit during that period, but the adjudicating authority, on the basis of reports of the department, observed that those certificates are not genuine and those certificates are not helpful to the appellant. The appellant submits that this is nothing like arbitrary action by the adjudicating authority. This situation is similar to the fact that the person cannot be judge for his own wrong done. It is submitted that on one side the Department giving certificate that, the appellant has not taken benefit of CENVAT credit and on other side on subsequent report, the depa....
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.... which is exactly applicable to the case of the present appellant. It is submitted that in this judgment the Hon'ble Apex Court specifically said in para 8 that even when the credit is taken, if the entry is reversed before utilization, it would amount to not taking credit. In view of the aforesaid situation, the appellant is entitled to benefit of drawback and the impugned order of the adjudicating authority bad in law and requires to be quashed and set aside. 4.1.5 It is submitted that the view taken by the CESTAT (Ahd.) in the case of the Face Ceramics Pvt. Ltd. v. CCE, Rajkot, reported in 2010 (249) E.L.T. 119, wherein the Hon'ble Tribunal has followed the view of the Hon'ble Gujarat High Court, in the matter of the CCE v. Ashima Dyecot Limited - 2008 (232) E.L.T. 580 (Guj.) = 2008 (12) S.T.R. 701 (Guj.) and another judgment of the Hon'ble Allahabad High Court [2004 (174) E.L.T. 422 (All.)], wherein it was held that even if reversal is made subsequently, that would amount to as if no credit has been availed, whereas here the case is that the credit is reversed before the clearance of goods. Therefore the appellant is entitled to benefit of the duty drawback. 4.1.6&em....
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....ertificate dated 4-3-2008 was not issued by their office. Same admission has been made by Shri Sisodiya, Authorised Signatory of the exporters in his statement as well as during the course of Panchanama drawn by Central Excise authorities at Ahmedabad. Moreover, the Additional Commissioner Central Excise, Ahmedabad-I vide letter F.No. IV/13-14/PI-VII/Texcellence/08, dated 27-3-2008 has reported that Cenvat facility has been availed during the said period. It was also opined that so called certificates appear to be forged. 4.2.3 The Commissioner (Appeals) had erred in holding in the very first instance that the adjudicating authority has "alleged" that the higher amount of drawback was claimed fraudulently by the respondents. In the instant case there was no allegation put forth by the department on the respondents but it was a fact that the higher rate of drawback was claimed right from the time the application was submitted vide letter dated 26-2-2008 by the respondents, though knowing very well that facility of CENVAT credit scheme was being availed by them. Not only that, even the certification on Invoice No. 10 dated 14-7-2007 for ARE-1 No. 12 dated 15-7-2007, enclosed ....
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....g availed. The mention of DBK Sr. No. 630401A which is for higher rate of drawback and on the requirement of production of non-availment of CENVAT credit certificate, two forged certificates were produced. A thorough investigation was carried out and regular panchnama was drawn at the respondents premises, thereafter a report was submitted by the Additional Commissioner, C.EX., Ahmedabad-I, that the so called certificates appear to be forged. Even, a mention at para 34.1 in the impugned order that the stamp on the certificates dated 3-3-2008 and 4-3-2008 of Superintendent shows AR-III, Div.II whereas the unit falls under the jurisdiction of ARE-II, Div.II. All this very clearly establishes that investigation was conducted and forgery was conclusively established and only then it was concluded that the exporter had a mala fide intention to avail higher rate of drawback and they have acted deliberately to usurp excess export benefits. 4.2.7 The Commissioner (Appeals) has erred in holding that since "the subject goods were not available for confiscation, the order of confiscation is also erroneous as per settled law". First of all, the respondents have tried to avail benefit o....
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....intention to deliberately usurp excess export benefits. 4.2.9 In view of the above, it is most respectfully submitted that the impugned order passed by the Commissioner of Customs (Appeals) is illegal, improper, unjust, unacceptable and untenable and therefore merits to be set aside and the imposed orders-in-original may be upheld. 5. A show cause notice was issued to the respondents under Section 129DD of Customs Act, 1952 to file their counter reply who vide their written reply dated 13-2-2012, mainly reiterated the submissions made in their revision applications. 6. Personal hearing scheduled in these cases on 20-4-2012 was attended by Shri H.D. Dave, Advocate on behalf of M/s. Texcellence Overseas who reiterated the grounds of revision applications. Shri Krishna Kumar C. Kundaliya, Superintendent of Customs attended hearing on behalf of Commissioner of Customs (Prev.), Jamnagar who also reiterated grounds of departmental revision application. 7. Government has carefully gone through the relevant case records and perused the impugned order-in-original and order-in-appeal. 8. On perusal of records, Government observes that M/s. Texcellence ....
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....dule, shall mean that the exporter shall satisfy the following conditions, (i) The exporter shall declare, and if necessary, establish to the satisfaction of the Assistant Commissioner of Customs or Assistant Commissioner of Central Excise or Deputy Commissioner of Central Excise, as the case may be, that no Cenvat facility has been availed for any of the inputs or input services used in the manufacture of the export products. (ii) If the goods are exported under bond or claim for rebate of duty of Central Excise, a certificate from the Superintendent of Customs or Superintendent of Central Excise in-charge of the factory of production, to the effect that no Cenvat facility has been availed for the goods under export, is produced." 8. From the above, it is clear that drawback is admissible at two rates, one at higher rate (Customs, Central Excise and Service Tax Component put together) when CENVAT facility has been availed and one at lower rate (Customs component only) when CENVAT facility has been availed. If higher rate of drawback is claimed, the stipulation of condition No. 12 of the said notifications is requi....
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....nput services used in the manufacture of the export products. Here, I find that the unit has come out of CENVAT Scheme with effect from 1-9-2007 by reversing credits relating to four types of goods - relating to fabric, capital goods, packing material and input service, whereas the clearance for exports took place on 15-7-2007, as certified in letter issued by the Central Excise Range AR-II, Division-II dated 30-7-2009, supra. I find that so far fabric is concerned, there is no doubt (as reported by the Central Excise vide letter dated 30-7-2009, supra) that it was not subject to CENVAT availment. However, the position in respect to packing material and use of input service in the export goods, in respect of which CENVAT was availed, and reversed subsequent to the export of the impugned goods, has not been made clear by the exporter. Normally, the value of packing material is part of the value of export goods, and CENVAT availed on this packing material shall be treated as CENVAT availed in respect of export goods, unless proved otherwise. In that case, the exporter shall be eligible only for the Customs portion of the drawback. Similarly, if any input service was used in the said ....
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....xport on 15-7-2007, cannot make him entitled for drawback claim at higher rate since the condition for claiming higher rate of drawback were not satisfied at the time of export. However, exporter was eligible for Custom portion of drawback as he had availed Cenvat credit facility. Commissioner (Appeals) has discussed the issue in detail and Government is in agreement with his findings. The case laws cited by exporter relate to availment of benefit of Central Excise Notification and the same cannot be made applicable to issue of admissibility of drawback claim in terms of Section 75 of Customs Act and Notification issued thereunder. Therefore, Government holds that Commissioner (Appeals) has rightly held drawback claim admissible at lower rate i.e. Customs portion only. 11. Department has contested that goods were liable to confiscation under section 113(h)(ii) of Custom Act for mis-declaration of goods under Drawback Sr. No. 630401A representing higher rate and all the notices were liable for penal action for charges mentioned in show cause notices. In this regard, Government finds that the fact of availment of Cenvat credit facility by exporter manufacturer is not denied b....