Hindustan Aluminium Corporation Ltd. vs Superintendent, Central Excise, ... on 27 November, 1980
6. It is by now well settled that goods which are cleared without payment of duty under Rule 13, having been exported or to be utilised in the manufacture of goods which are to be exported are not goods which are exempted from duty subject to nil rate of duty. Goods may be exempted from payment of duty under notification issued under Section 5A of the Act, or may be cleared at a nil rate of duty in cases where the tariff prescribed. Goods which are cleared without payment of duty in terms of Rule 12 or Rule 13 are neither the one or the other. The Supreme Court in its judgement in Hindustan Petroleum Corporation v. CCE 1995 (8) RLT 877 has approved for the view taken by the Delhi High Court in Hindustan Aluminium Corporation Ltd. v. Superintendent of Central Excise , that goods removed without payment of duty under Rule 13 are not exempted goods. That is also sufficient material in the statute book itself to rebut the Deputy Commissioner's contention that intention is not to allow modvat credit in case where the input is used in the manufacture of goods cleared without payment of duty. Sub-rule (4) of Rule 57 itself provides that credit of the duty paid on inputs used in the manufacture of export products may be refunded in cash, it cannot be utilised towards payment of duty on other final products. It is thus clear that the finished products exempted from payment of duty, cleared without payment of duty as referred to in Sub-rule (1) of Rule 57CC, will not include products cleared under Rule 12 or Rule 13. The provisions of this Rule 57CC cannot apply to the manufacture before us as a result of such clearance.