Nil VAT does not bar SAD refund where imported goods are sold and other notification conditions are met.

Refund of Special Additional Duty under Notification No. 102/2007-Cus. was held admissible where imported goods were subsequently sold, and a nil VAT liability on that sale did not by itself defeat the claim. The Tribunal followed its earlier precedent and treated the nil VAT rate as not excluding the transaction from the notification's refund mechanism, so long as the other conditions were satisfied. The rejection of the refund claim was therefore set aside and refund relief followed.

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Issues: Whether refund of Special Additional Duty was admissible under Notification No. 102/2007-Cus. where the imported goods were subsequently sold and VAT liability on such sale was nil.

Analysis: The refund scheme under Notification No. 102/2007-Cus. grants refund of SAD when imported goods are sold on payment of Sales Tax/VAT. The rejection based only on the ground that VAT payable was nil was not accepted. The Tribunal followed its earlier decision holding that the question stood covered by precedent, and that a nil rate of VAT does not exclude the transaction from the scope of the notification for refund purposes.

Conclusion: Refund of SAD was held admissible and the rejection of the claim was set aside.

Final Conclusion: The appeals were allowed with consequential relief, resulting in refund relief to the assessee.

Ratio Decidendi: For the purpose of Notification No. 102/2007-Cus., a nil VAT rate on the subsequent sale does not, by itself, defeat entitlement to refund of SAD where the other conditions of the notification are satisfied.

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