2014 (10) TMI 123 - AT - Customs

Appeals rejected, cross-objections allowed. Upheld decision on SAD refunds re-credit. Circular compliance noted.

The appeals by the Revenue were rejected, and the cross-objections by the respondents were allowed. The first appellate authority's decision to sanction ... SAD Refunds - Notification No. 102/2007-Cus dated 14.09.2007 - Whether sanctioning of 4% of SAD refunds by way of re-credit in the respective licenses after 30.06.2013 was proper or not - Held that:- utilisation of re-credited amounts was permitted / revalidated by CBEC Circulars till 30.06.2013 which was further extended up to 30.09.2013. In Para 7.6 of the orders dated 20.01.2014 passed by the first appellate authority it is factually stated that the re-credits were given well before 30.09.2013. It has not been brought on record by the Revenue that re-credit was allowed by the adjudicating authorities after 30.09.2013. It is also seen that there is no condition under Notification No. 102/2007-Cus that SAD duty should be initially paid through cash. It has been correctly agitated by the respondents in the cross objections that a right given under an exemption notification cannot be taken away by the issue of Departmental Circulars. In view of the above observations orders passed by the first appellate authority are legally correct and are not required to be interfered with - Decided in favour of assessee. Issues:1. Proper sanctioning of 4% SAD refunds by re-credit in licenses after 30.06.2013.Analysis:The appeals were filed by the Revenue against orders upholding decisions by adjudicating authorities regarding the fulfillment of conditions of Notification No. 102/2007-Cus for sanctioning refunds of 4% Additional Customs duty. The Revenue argued that Circulars and trade notices extended the time limit for using re-credited DEPB scrips until 30.09.2013, and applications should have been disposed of by 30.06.2013. The Revenue contended that DEPB Scrips could not be used after 30.09.2013 for discharging SAD liability. However, the respondents argued that all refund claims were filed before 30.06.2013, meeting the conditions of the notification, and Circulars should not affect their right to claim refunds.The main issue was whether sanctioning 4% SAD refunds by re-credit in licenses after 30.06.2013 was proper. The first appellate authority's orders noted that re-credits were given before 30.09.2013, as permitted by CBEC Circulars extended until that date. There was no evidence that re-credit was allowed after 30.09.2013. Additionally, there was no requirement in Notification No. 102/2007-Cus that SAD duty must be initially paid through cash. The respondents rightly argued that a right under an exemption notification cannot be negated by Departmental Circulars. Consequently, the orders by the first appellate authority were legally sound and did not warrant interference.In conclusion, the appeals by the Revenue were rejected, and the cross-objections by the respondents were allowed, affirming the decisions made by the first appellate authority regarding the sanctioning of 4% SAD refunds by re-credit in licenses before 30.09.2013.