Customs, Excise and Gold Tribunal - Hyderabad
Dolphin Drugs (P) Ltd. vs Cce on 22 August, 2002
Equivalent citations: 2002(105)ECR602(TRI.-HYDERABAD)
ORDER G.A. Brahma Deva, Member (J)
1. Issue relates to refund claim. The facts of the case in brief are that during quarter from October 1996 to December 1996, the appellants have exported under bond 22000 kgs of Sulphamethoxazole, under AR4 Nos 10/96-97, 11/96-97 dt. 27.10.1996 and 15/96-97 dated 29.11.1996. The modvat credit of duty on the inputs used in the said exported goods is Rs. 11,26,705/-. The appellants stated that they are not in a position to utilize credit of duty either for clearances of goods for home consumption or for the goods exported during the said period. They have filed refund claim on 8.1.1997 for Rs. 11,26,705/- as per the proviso to Rule 57F(4) of Central Excise Rules read with Section 11B of Central Excise Act and Notfn. No. 85/87 dated 1.3.1987. The Assistant Commissioner who adjudicated the proceedings has rejected the refund claim on the ground that the appellants are required to reverse the refund amount in RG 23A Part II account simultaneously before the issue of cheque in terms of Notification No. 85/87 as amended on the date of sanctioning the refund. But as per Notification No. 6/97 CE(NT) dt. 1.3.1997, the unutilised credit in the RG 23A Pt. II account is to be lapsed except the admissible credit on inputs left in stock as well as inputs contained in finished goods as provided under the said rule which is to be claimed by the appellants. The appellants are not permitted to utilize the credit of refund amount in the admissible credit. In other words, the credit pertaining to the exports made during October 1996 to December 1996 also get lapsed.
2. It was the contention of the party that as per the operative Rule of 57F(4) up to 28.2.1997 and as per the present Rule 57F(13) with effect from 1.3.1997, the manufacturers shall be allowed refund of un-utilised credit of duty pertaining to inputs used in the exported goods for the above period, that refund of Modvat credit of duty under the then Rule 57F(4) and present 57F(13) is eligible and Sub-rule 57F(13) is independent of Sub-rule 57F(17) and the eligibility of refund of duty paid on inputs used in the exported goods is not hit by the provisions of Rule 57F(17).
3. The appellants become unsuccessful even before the Commissioner (Appeals). Hence, this appeal.
4. It was brought to our notice that the issue involved has been covered by the decision of the Tribunal in the case of Commissioner of Customs and Central Excise Jaipur v. Samtel India Ltd. reported 2000 (39) RLT 974. In this context, the learned Counsel drew our attention to paras 3 & 4 of the order which are as under.
3. The learned Counsel for the respondents has submitted that the Revenue's appeal is directly contrary to the instructions of the Board. The Board's instructions which had been quoted in page 2 of order-in-appeal clearly states that it applied to the credits earned before 1.3.1997 and these instructions were issued on 12.12.1997. Therefore, it is clear that the Board considered that the refunds are payable without treating the credits as having lapsed on 1.3.1997 and therefore, reversal/cancellation of credit on inputs upon granting of refund should be of credits in the accounts prior to 1.3.1997. The learned Counsel also submitted that the exported goods were produced and exported much before the lapse of credit under Rule 57F(17) with effect from 1.3.1997. Therefore, the credit to be reversed should be of that period and not the credit subsequently earned by the respondents.
5. We have perused the records and have considered the submissions made by both the sides. Rule 57F(4)/57F(13) provides for grant of cash refund of outstanding modvat credit on inputs used in the production of the exported goods. The exports in the present case had taken place in 1996. Therefore, the relevant credit for the purpose of refund would be of that period. This is the position clarified by the Board also in its clarificatory letter dated 12.12.1997. Therefore, we are of the view that there is no justification for denying the refund to the respondents or in asking them to reverse the credit earned on purchase of inputs during a subsequent period. The impugned order being in conformity with the instructions of the Board, it is not open for the Revenue to challenge it before us. In the circumstance, we are not able to find merit in the appeal. The appeal is accordingly rejected."
6. Heard Shri Narasimha Murthy, learned DR for the Revenue.
7. Considering the facts and circumstances and since the very issue has already been considered by the Tribunal, we accept the contention of the party and in the result appeal is allowed with consequential relief if any.
(Pronounced and dictated in open court)