Case Law Details
Ercon Composites Vs Union of India (Rajasthan High Court)
Shorn of legal technicalities what emerges is that the petitioner as a 100% EOU would have made purchases of raw material and inputs from the local market without payment of excise duty as well as not born duty on final product manufactured by it on a promise that the final product would be eventually exported. When it showed the desire to convert itself from 100% EOU to DTA, as per requirement of law, it had to pay up the excise duty on such purchases and final product where duty was previously not collected. Admittedly, such duty was paid at the time of what is referred to de-bonding. However, this would not prevent the exporter from claiming refund of excise duty if the goods are eventually exported. The petitioner as a DTA unit exported the goods and claimed refund of excise duty previously paid in its capacity as an EOU. We do not find that there is any procedure in law to deprive the petitioner from such benefit. The appellate authority has correctly discussed the legal position. The revisional authority has committed error in reversing the said order.
FULL TEXT OF THE JUDGMENT/ORDER OF RAJASTHAN HIGH COURT
The petitioner has challenged an order dated 17/18.04.2018 passed by the revisional authority reversing the appellate and adjudicating orders which were in favour of the petitioner.
Brief facts are noted from D.B. Civil Writ Petition No. 11298/2018. The petitioner had established a manufacturing unit which existed initially as a 100% Export Oriented Unit (‘EOU’ for short). Sometime later on, the petitioner converted itself from EOU to a non-EOU unit. At the time of such conversion, the petitioner had paid the excise duty on the goods which were waived in the capacity of EOU. The petitioner thereafter exported the finished products from the domestic terrify area (‘DTA’ for short). Against these exports, the petitioner sought refund of the excise duty previously paid. The adjudicating authority as well as appellate authority accepted the request. The matter was carried in revision by the Government. The revisional authority reversed said orders by the impugned order. The main focus of the revisional authority was that the EOU unit and the DTA unit were not the same entity, for which purpose, the authority referred to the central excise registration numbers. Primarily on this ground, the benefit was denied.
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