For the purpose of DEPB , DGFT circular will prevail

CHATROOM

Through notification no. 50/2008-C.Ex.(N.T.) dated December 30, 3008, , the government has placed the clearances made to both ‘SEZ (Special Economic Zone) units’ and ‘SEZ developers’ on the same plane so far as Rule 6 of Cenvat Credit Rules, 2004 (CCR) is concerned and as a result, the manufacturers making clearances even to SEZ developers henceforth would not be required to maintain separate accounts or pay 10 per cent amount or reverse the credit taken. What is the status of the clearances made before the date of the notification?
I have no doubt that the position was no different earlier because clearances to SEZ are exports and were being allowed under bond or UT1 even earlier. In my view, the latest amendment sets at rest any doubts, as some field formations were disallowing credit or insisting on 10 per cent payment, if the clearances were being made from Domestic Tariff Area (DTA) to SEZ developers without duty payment.

In your column on December 22, 2008, you have mentioned that for calculating the aggregate limit of Rs 4 crore under the SSI exemption, we are required to count all the clearances of excisable goods — whether subject to ‘nil’ duty or not (except, those specifically excluded). Can you mention the specific exclusions?
You may refer to Para 4 of the exemption notification no. 8/2003-C.E. dated March 1, 2003, which covers components supplied to original equipment manufacturers by following specified procedures, goods manufactured in rural industries and/or registered with specified agencies, writing pads, account books etc. and specified packing materials.

Please let us know whether the interpretative notes given in the Customs Tariff will prevail over the DGFT Policy Circulars for the purpose of grant of DEPB benefits.
DEPB Schedule cannot be strictly interpreted at par with the Customs Tariff Schedule. The DEPB Entry is required to be reasonably interpreted to allow the export benefit. For the purpose of DEPB scheme, the DGFT Policy Circular will prevail. In this connection you may refer to the Case law of Amiya Commerce and Construction Pvt. Ltd [2007 (217) ELT 514 (Tri.-Kol.)] and Aysha Export Corporation [2006 (199) ELT 299 (Tri.-Mum.)

One of our service providers raised a bill without including service tax. Subsequently, he sent a debit note for the service tax amount. Can we take Cenvat Credit on the basis of the debit note?
The Cenvat Credit Rules allow you to take Credit on the basis of supplementary invoice. So, you may ask the service provider to raise a supplementary invoice for the tax amount giving cross reference to the original bill.

We have received a Letter of Credit (LC), which does not specify ‘Notify
Party’. But the Bill of Lading indicates his agent at destination as ‘Notify
Party’ as the buyer asked us to do so. Is this a discrepancy?
No. Please refer to Article 124 of International Standard Banking Practices, International Chamber of Commerce Publication no. 681.