P.K. Choudhary DECISION
P.K. Choudhary, Member (J)
1. This appeal has been filed by M/s. Kancor Ingredients Limited against Order-in-Appeal No.NOI-EXCUS-002-APPL-1554- 2019-20 dated 13-03-2020 passed by the Commissioner (Appeals) CGST, Noida. The learned Commissioner (Appeals) has upheld the rejection of refund claim for Rs.4,00,278/-.
2. Briefly stated, the facts of the case are that the Appellant is engaged in manufacture of Menthol Crystals, Dementholised Peppermint Oil, Peppermint Oil etc. falling under chapter 29, 30 and 33 of Central Excise Tariff. Most of their sales are for export to countries like France, USA, UK etc. In terms of Central Excise Notification No.12/2012 : MANU/EXCT/0023/2012 dated 17-03-12, all the final products of the Appellant became exempted from payment of duty. Appellant filed refund claim for Rs.4,00,278/- claiming refund of accumulated Cenvat Credit for the period from April, 2017 to June, 2017 under Rule 5 of Cenvat Credit Rules, 20041 read with Notification No.27/2012-CE dated 18-06-12. The said refund claim pertained to that portion of Cenvat Credit which was attributable to export of goods. The Jurisdictional Deputy Commissioner rejected the said claim after observing that in terms of Rule (6)(1) of CCR, 2004, Appellant was not eligible to avail Cenvat Credit. He also observed that refund under Rule 5 of CCR, 2004 is admissible to those manufactures, who are engaged in manufacture of dutiable goods. On appeal, the learned Commissioner (Appeals) upheld the order of the Lower Authority after observing that Cenvat Credit is not available on input and input services used exclusively in the exempted goods. However, in terms of Rule 6 (6)(v) of CCR, 2004, Cenvat Credit is allowable in case of export under bond. In view of Notification No.42/2001-CE, Appellant was not eligible to export goods under bond and therefore refund claim is liable to be rejected.
3. The learned Chartered Accountant submitted that there is no dispute on the fact of export of goods; that these are eligible for refund under Rule 5 of CCR, 2004; that non clearance of exempted goods under bond is only a procedural issue; that substantive benefit of refund should not be denied for procedural/ technical reasons; it is policy of the Government that export should be zero rated, only goods should be exported and not the taxes; there is no condition in Notification No.27/2012 dated 18- 06-2012 that goods should be exported under bond; that for the earlier period, they have been allowed refund by the order of Commissioner (Appeals). He also placed reliance on following decisions:-
(a) Jolly Board Ltd. vs. CCE reported in MANU/CM/0001/2014 : 2015 (321) E.L.T. 502.
(b) Jobelle vs. CCE reported in MANU/CM/0185/2006 : 2006 (203) E.L.T. 627.
(c) Union of India vs. Sharp Menthol India Ltd. reported in MANU/MH/0459/2011 : 2011 (270) E.L.T. 212 (Bom.).
(d) Commissioner of Central Excise vs. Drish Shoes Ltd. reported in MANU/HP/0152/2010 : 2010 (254) E.L.T. 417 (H.P.)
4. The learned Departmental Representative justified and reiterated the impugned order.
5. Heard both sides and perused the appeal records.
6. The main issue in this appeal is as to whether refund of accumulated Cenvat Credit is allowable on export of goods which are........