Per T.K. Jayaraman : Both these appeals have been filed against the following Orders-in-Appeal. The details of the appeals are given below:-

2. The issue involved in both these appeals is one and the same. Therefore, I am taking up both the matters together for issuing a common order.

3. Shri B.N. Gururaj, the learned Advocate, appeared on behalf of the appellants and Smt. Sudha Koka, the learned SDR, for the Revenue.

4. I heard both sides.

5. The appellants are 100% EOU. They received dutiable inputs from certain dealers for the manufacture of the finished products which are to be exported. They availed Cenvat credit on the duty paid inputs. Since they were not in a position to utilize the credit, they applied for refund of the Cenvat credit availed by them. The reason is that all their products were exported and there was no domestic clearance. The lower authority rejected the refund claims on the ground that in terms of sub-rule(1) of Rule 6 of CENVAT Credit Rules, the appellants could not have taken credit of duty paid on the inputs because the final products are subjected to NIL rate of duty. The appellants were aggrieved over the orders of the lower authority. They approached the Commissioner (Appeals). The Commissioner (Appeals) also held that the goods which are exported are subjected to NIL rate of duty. In this view of the things, he said that the goods are actually exempt. Once it is held that the finished products are exempt from duty then, in terms of Rule 6(1) of the CENVAT Credit Rules, even the credit could not have been availed. Once the appellants are not entitled for the credit, there is no question of refunding the same. This is the argument of the Revenue. The learned Commissioner (Appeals) upheld the orders of the lower authority.

5.1. The learned Departmental Representative reiterated the findings in the impugned orders. However, Shri B.N. Gururaj, the learned Advocate, argued that even though no credit can be taken on goods, which are exempted, there is a vast difference between the goods, which are exempted and the goods. He said that there is clearly a distinction between exempted goods and exported goods. The exempted goods are exempted by virtue of Notification. He relied on the decision of the Tribunal in the case of Alpha Drug India Ltd. Vs. CCE, Chandigarh - 2000 (38) RLT 304 (CEGAT)=2000 (118) ELT 783 (T) wherein the Tribunal has held that erstwhile Rule 13 of the Central Excise Rules 1944, allows exports without payment of duty, which is not the same as goods chargeable to NIL duty or exempt goods. Hence, it was held that the provisions of erstwhile Rule 57C (now Rule 6(1)) did not apply to exports. Further, in Reliance Industries Ltd. Vs. CCE, Bombay - 1995 (78) ELT 595 (T), the Tribunal has held that when the final products are cleared under bond for export in terms of erstwhile Rules 191B/191BB of the Rules of 1944, they were neither exempt goods nor Nil duty goods. Hence, modvat credit was held admissible. He relied on the above mentioned case-laws. Further, the learned Advocate pointed out that the appellants could have procured indigenous goods without payment of duty under CT-3 Certificate. However, for trade reasons, in the present cases, they had to obtain duty paid goods and the option is open to the appellant and there is no restriction that 100% EOU cannot obtain indigenous inputs which are duty paid. For this, he relied on the decision of this Tribunal in the case of Tata Tea Ltd. Vs. CCE, Cochin - 2006 (73) RLT 472 (CESTAT-Ban.)=2006 (200) ELT 81(Tri.-Bang.) wherein it is held that the benefit of Rule 5 of CENVAT Credit Rules cannot be denied even though the assessee is a 100% and could have obtained input free of duty by following the procedures in Notification No. 1/1995-CE. It was held t