By TIOL News Service

KOLKATA, JAN 15, 2019: THE petitioner had exported three shipments of Pyrolisis Gasoline (Py Gas) on payment of excise duty. The Py Gas was produced by using Naptha as raw material imported by the petitioner in terms of the Advance Licence dated September 1, 2003. Imported Naptha is exempt from customs duty.

The rebate claims made by the petitioner in terms of the DEEC Scheme were accompanied by copies of ARE–1 Forms.

ASCN was issued alleging that the exports contravene the provisions of Rule 18 of the CER, 2002 and, therefore, claims cannot be sanctioned.

The claim was rejected but appeal proved fruitful.

However, the department filed a revision application and the impugned order came to be passed pursuant to which the present petition is filed.

The petitioner submitted that the revisional authority erred in reversing the order under appeal and disallowing the claim for rebate;that the ARE-1 Form is conclusive evidence of the exports occurring; that the ARE-1 Forms are not under challenge by the department, therefore, the revisional authority ought not to have reversed the finding rendered in the o-in-o. - 2013-TIOL-386-HC-MUM-CX   - UM Cables Limited v. Union of India  relied upon.]

The counsel for Revenue submitted that since the petitioner failed to file the requisite documents, the revisional authority correctly remanded the matter to the appellate authority to take such facts into consideration.

After extracting the notification 19/2004-CE(NT) dated 6 September 2004, rule 18 of CER, 2002and paragraph 8 appearing in Chapter 8 of the Supplementary Instructions issued by the CBEC, the High Court observed –

+ UM Cables Limited (supra) considering such notification and Rule 18 of the Rules of 2002 is of the view that, an exporter is entitled to lead supplementary evidence to establish its claim for grant of rebate.

+ Non production of the documents stipulated in the notification does not ipso facto result in the claim being invalidated.

+ The revisional authority disallowed the claim by requiring the petitioner to produce further documents. Paragraph 8 of the Supplementary Instructions, 2005 require that the rebate claim should be accompanied by the documents stipulated therein.

+ A claimant can succeed to substantiate its claim on the basis of all or any of the documents mentioned in Paragraph 8 of the Supplementary Instructions, 2005 or on the basis of secondary evidence. What is required is that the claim is substantiated by cogent evidence.

+ If a claimant is in a position to substantiate its claim for rebate on the basis of any of the documents mentioned in Paragraph 8 of the Supplementary Instructions, 2005 or by leading secondary evidence with regard to its claim, then such claim is required to be allowed notwithstanding the failure of the claimant to produce all the documents mentioned therein.

Concluding that the revisionary authority is incorrect in disallowing the claim when the fact of the matter is that the veracity of the ARE-1 forms have not been doubted by the Revenue, the impugned order was quashed.

The authorities were directed to act in terms of the order passed by the appellate authority, namely, sanction the refund.

The Writ petition is disposed of.

(See 2019-TIOL-116-HC-KOL-CX)