JUDGMENT

Sanjiv Khanna, J.:

Mr. Pankaj Kumar Jain, proprietor Parshva Overseas assails the Order dated 18th February, 2010 passed by Mr. D.P. Singh, Joint Secretary, allowing the revision application filed by the Commissioner of Central Excise, Delhi-I, represented before us by the Union of India-the respondent. The relevant and operative portion of the impugned Order reads :

"8. Government further observes that para 1.5 of Part V of CBEC Excise Manual of Supplementary Instructions, 2005 stipulated as under :

" 1.5 The benefit of input stage rebate cannot be claimed in any of the following situations. :

(i) Where the finished goods are exported under claim for duty drawback;

(ii) ..................................

(iii) Where facility of input stage credit is available under Cenvat credit Rules, 2002.

(iv) .................................

(v) ................................."

9. From above, it is clear that the merchant exporter/manufacturer exporter can not claim input stage rebate claim if he chooses to avail duty drawback or input cenvat credit. This provision has been made to deny double benefit to the exporters i.e. to avail cenvat credit on the inputs utilized and also to claim input stage rebate claim on those very inputs utilized in the manufacturing/processing of the finished goods. Government policy is to relieve the burden of the input duties suffered on the exported goods to make them more competitive in the international market. Double benefit cannot be allowed to the exporter as the respondent has already taken cenvat credit on inputs and have also utilized the same for clearance of scrap.

10. Government agrees with the case laws referred by the respondent that procedural lapses may be ignored if there is a substantial proof of export of goods. But their case does not fall in that category as it will amount to granting double benefit to them.

11. In respect of the respondent plea regarding the applicability of provision of Rule 6(6)(v) of Cenvat Credit Rules, 2004, Government observes that Rule is not relevant in their case as that Rule relates to export of goods without payment of duty under Bond.

12. The respondent has placed reliance on the order No. 218 to 223-R dated 30.07.08 in the matter of M/s. Pawan Jain and Sons under which the Assistant/Deputy Commissioner has sanctioned the rebate claims on the similar matter. In this regard, Government observes that M/s. Pawan Jain and Sons vide their letter dated 18.02.09 has intimated the Assistant Commissioner Central Excise Division I, New Delhi that they have reversed the input cenvat credit availed on account of refund/rebate claim sanctioned vide those orders. Hence, the ratio of these orders is not applicable in their case."

2. Learned counsel for the petitioner had submitted that the impugned Order refers to/relies upon the principle of double benefit and urged that it was not the case of the Revenue that the petitioner had enjoyed double benefit. In this connection, our attention was drawn to the Order dated 8th December, 2008 passed by the Assistant Commissioner, rejecting the application of the petitioner for refund/rebate of Rs.23,62,737/-.

3. The petitioner is a manufacturer and exporter of stainless steel circles and utensils. For this purpose it purchases stainless steel coils/flats which are an input or raw product which is first converted into stainless steel circles and then in the second stage is used to manufacture stainless steel utensils. Conversion of stainless steel coils/flats into stainless steel circles attracts payment of excise duty under the Central Excise Rules, 1944 but conversion of stainless steel circles into stainless steel utensils is exempt from payment of excise duty as per Notification No.10/2003 dated 1st March, 2003. The petitioner had purchased Stainless Steel Coils/ flats from registered dealers for manufacture of stainless steel circles. Central Excise duty was paid on Stainless Steel Flats/Coils when the said raw m