Vardhman Spinning And General Mills ... vs C.C.E. on 10 June, 1999
3. When the matter came up before the Commissioner (Appeals) in the appeal filed by the present appellants, appellants had contended, inter alia, that though the appellants were a 100% EOU, local manufacturers of yarn located in the area not being well-versed with the incentive scheme available to 100% EOU, were not willing to supply the yarn to the appellants without payment of duty and since the procedure for CT-3 certificate involved a lot of scriptory work, suppliers of small quantities of yarn were not interested to supply yarn to the appellants. Appellants contend that the authorities below had not considered the said explanations and their claim for refund had been rejected unfairly by the Assistant Commissioner simply for the reason that while the appellants had issued CT-3 certificates for procuring certain other duty-free raw material, the said procedure had not been followed in the case of procurement of yarn. It was further contended that the Assistant Commissioner had wrongly held that their refund claim was not covered by Section 11B. On the issue of whether the buyer of inputs who uses them captively was entitled to refund claim, appellants place reliance upon the Tribunal's decision in Vardhman Spg. & General Mills v. CCE 1993 (68) E.L.T. 919 wherein the claim of refund of duty by such buyer was held to be admissible.