Admissibility of Rebate claim when original documents get lost

PJ/Case Laws/2011-12/1406

Case: IN RE: GARG TEX-O-FAB PVT LTD

Citation: 2011 (271) ELT 449 (G.O.I.)

Issue:- Rebate claim – original documents lost – whether rebate admissible on the basis of collateral evidence for export of goods?

Brief Facts:- Respondent filed four rebate claims dated 28-8-06 for rebate of Central excise duty paid on the goods cleared under ARE-1 No. dated 29-12-05, 6-12-05, 4-2-06 and 5-12-05 respectively. On scrutiny of the claims, it was observed that original, duplicate and triplicate copy of ARE-1, duplicate copy of invoice were not enclosed with the said rebate claims. The sailing date on mate receipt does not match with date of Bill of Lading. Also letter dated 3-8-06 addressed to Maritime Commissioner, Central Excise, Raigad mentioned that Respondent are merchant-exporters, whereas from ARE-1 and Central Excise Invoice it appears that they are manufacturer.

Deficiency memo-cum-show cause notice was issued and the Adjudicating Authority rejected the rebate claims. The Assistant Commissioner rejected the rebate claims as the respondent could not produce the original documents i.e. original, duplicate & triplicate copies of the ARE-I as required under the provisions of Notification No. 19/2004-C.E. (N.T.), dated 6-9- 04.

Being aggrieved, Respondent filed appeal before the Commissioner (Appeals). The Commissioner (Appeals) held that the right to rebate on export of excisable goods is granted by the statute and the documents listed in the Notification and departmental instruction are only evidence of the occurrence/event to which they relate to when available, the original ARE-1 and invoice copies proved removal from factory on payment of duty, export details etc. When same thing can be proved by collateral evidence/reconstructed copies, the rebate cannot be denied. The representative of the respondents while travelling lost the documents. The respondent lodged a police complaint also but the documents could not be recovered. The loss of the documents in these circumstances cannot extinguish the statutory right of rebate. The Basic Manual of Departmental Instructions of AR-4 forms as per Board's Letter F. No. 17/19-C.X.- 11/51, dated 23-5-1955. There is no dispute regarding duty payment and export. The law is settled that substantial benefits granted by the law cannot be denied on technical grounds. Accordingly, the impugned order rejecting the rebate claims on technical grounds was set aside.

Revenue has filed revision application under Section 35EE.

Applicant’s Contention:- Revenue contended that the point regarding the finding of Maritime Commissioner that how the goods shall be shipped on board after the ship had sailed was not answered. The issue regarding difference in date shown on mate receipt and In ARE-1 No. 22 & 23 is a clerical mistake and the date shown on mate receipt is the correct date has not been authenticated/supported by shipping company/customs officers. It was alleged hat the conditions, limitation and procedure prescribed in Notification No. 40/2001-CE(NT) dated 26.06.2001 and Notification No. 19/2004-CE(NT) dated 06.09.04 as amended issued under Rule 18 of Central Excise Rules,2002 for grant of rebate of duty for export of goods not adhered to. Original copy of statutory documents not submitted with the claim and therefore the duty paid nature of the goods cannot be ascertained nor established and therefore, the fundamental criteria envisaged in Para 8.4 Part I Chapter 8 of CBEC’s Excise Manual of Supplementary Instructions for ascertaining the duty paid character/nature/identification of the goods exported, are not fulfilled. The loss of revenue by grant of such rebate on the basis of photocopies not envisaged. Much importance is given to the originality of the documents.

Reliance was placed on the following judgments and it was contended that the issue in dispute in the present case is squarely covered in an identical set of circumstances holding that the basis of xerox copies of documents have no evidence and liable to be misused as any number of copies can be made from one document:

- J. Yashoda v. K. Shobha Rani [2007 (212) E.L.T. 458 (S.C.)]
- M/s. Jandial Shoe Factory v. C.C.E., Kanpur [2006 (193) E.L.T. 128 (Tn.)]
- C.C.E., Surat-II v. Mercury Plast [2005 (191) E.L.T. 595 (Tri.-Mum)]
- C.C.E., Chandigarh v. Vision Electronics [2004 (175) E.L.T. 653 (Tn. Del.)].
- L&T Ltd. v. C.C.E., Mumbai [2003 (161) E.L.T. 795 (Tri.-Del.)].

Respondent’s Contention:- Respondent-assessee contended that there is no allegation that goods cleared for export has not been exported. The physical export of fabrics was certified by Customs as well as Central Excise. Further, they have received the remittances from abroad. Proper duty has been paid at the time of clearance. There is no allegation that the fabrics cleared were not duty paid.

It was submitted that the shipping bills in respect of all the four ARE-1s also showed he ARE-1 No. and date. They contained all particulars contained in ARE-1 including weight tally with the Shipping Bill and Bill of lading. The same preventive Officers who signed the ARE-1s have signed the shipping bill. The same Central Excise officer who issued the certificate of duty payment has signed the original sixtruplicate copy of the ARE-1. This is also countersigned by the Customs Authorities. The jurisdictional Supdt has also certified the duty payment and in lieu of triplicate issued the attested copy of ARE-1 in sealed cover. The preventive officer of customs showing therein the mate receipt No. &n dated and certified the physical export signed the shipping bill as well as ARE-1. The goods manufactured by them were exported and duty was paid on the same. And foreign remittances were also received.

It was submitted that in case of any doubt arising with the Maritime Commissioner the genuineness of the document could have been very well referred to the Customs Authorities and Central Excise Authorities and could have been verified.

Respondent relied on Board's Circular No. 510/06/2000-C.X. dated 3-2-03 regarding assessment which is the duty of Range Officer and rebate sanctioning authority should seen the admissibility of rebate claim and Government of India Order No. 7 to 9/2001 dated 19-1-01 - M/s. Krishna Filaments [2001 (131) E.L.T. 726 (GOI)] - Rebate claims should not be rejected on technical grounds.

With regard to difference in dates shown in Bill of lading and mate receipt, it was submitted that there is no difference in respective ARE-1s dated 5.12.05 and 4.2.06. But there is slight variation in he ARE-1s dated 29.12.05 and 06.12.05, there is a slight difference which is because of a clerical mistake. The date shown in mate receipt is correct and proper. This date on mate receipt is certified by the Customs officer on the ARE-1. The shipping bill number is mentioned on both the mate receipt as well as bill of lading and ARE-1 number is shown on the shipping bill. All these tally together. Further, the Customs Authorities countersigns the shipping bills by showing the mate receipt number and date of sailing.

Reasoning of Judgment:- Government observed that the respondent could have reconstructed the documents (ARE-1s) as per the provisions of Board letter F. No. 17/19-CX-II/51, dated 23.05.1955 duly endorsed/certified by the jurisdictional Central Excise Authorities and as regards Par ‘B’ of ARE-1s from the Superintendent of Customs who have passed the Shipping Bills and allowed the export. It is observed that instead of rejecting the rebate claims for non-submissions of original copies of the ARE-1s purportedly lost by the applicant should have considered collateral evidence to verify whether the duty paid goods have actually been exported or not.

Government set aside the impugned orders and remanded the case back to the Original Adjudicating Authority to decide the case afresh after giving proper opportunity to the respondent who may submit all requisite collateral evidences/documents to prove the export of duty paid goods as per provisions of Notification No. 19/2004-C.E. (NT.), dated 6-9-04 read with Rule 18 of Central Excise Rules, 2002.

Decision:- Appeal allowed by way of remand.

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PJ/Case Laws/2011-12/1406

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