Area-based exemption - Double benefits theory may put exports in double jeopardy !

Extract of Circular 3.4.2007

'The units located in other parts of the country manufacture the goods, and pay the applicable excise duty on export of goods, and therefore, they are eligible to claim rebate of said duties under rule 18 of the Central Excise Rules, 2002'.

It is crystal clear that the Board is referring to duty paid on 'export of goods'.

PradeepDShah PradeepDShah 12/04/2007

 

The Board's instruction dated 03.04.07 obviously talks about rebate of duty paid on export of goods and its eligibility to the manufacturer located elsewhere in the country. To state the obvious the Board need not issue an instruction. After all nobody can deny the duty paid by the other manufacturers on exported goods.

If you are just looking at the two circulars then you are missing the point. There is more to this issue of cash refund and this element of cash refund being eligible as rebate for those units within the area based exemption as well as those units lying elsewhere and which consume these goods as inputs.

It requires analyses of the entire gamut of these area based notifications, the conditions therein and the various possibilities it throws up for the units availing these area based notifications as well as for those units lying elsewhere but consuming the goods (as inputs) for further manufacture. After this juxtapose these two instructions issued by the Board and see the kind of havoc it may play in the field. This is what I intended to say in my write up and concluded that it would have been better off if the Board had not issued these instructions at all.

It is not a case of just picking one thread and say that you have solved the entire problem. I have read these instructions, the notifications and analyzed the various permutations and combinations arising out of it twice over before attempting this write up. Anyway thanks for the extract.

santosh hatwar 12/04/2007