Tribunal grants SAD exemption on imported LPG sold through high sea sales

The Tribunal allowed the appeal, setting aside the order denying Special Additional Customs Duty (SAD) exemption on imported LPG purchased through high sea sales. The Tribunal found that the appellant, who paid sales tax as the LPG was subsequently sold to customers, was eligible for SAD exemption under Notification No. 34/98. Citing a relevant precedent, the Tribunal held that SAD is not leviable when imported goods are sold as such and bear the burden of sales tax, leading to the unsustainable nature of the demand for SAD in this case.

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Issues: Denial of Special Additional Customs Duty (SAD) exemption on imported LPG purchased through high sea sales.

Analysis:
The appeal was filed against the Order of the Commissioner (Appeals), which related to the demand of Rs. 3,23,338/- as special additional customs duty not paid by the appellants due to goods being purchased through high sea sales. The adjudicating authority confirmed the demand under Section 28(1), and on appeal, the Commissioner (Appeals) upheld the order, leading to the present appeal.

The appellant argued that despite purchasing the goods through high sea sales, they paid sales tax as the LPG was subsequently sold to various customers. They claimed eligibility for SAD exemption under Notification No. 34/98, which exempts SAD on goods imported for sale. The appellant cited relevant case laws to support their argument.

On the contrary, the Revenue contended that the exemption from SAD was not available as the goods were purchased through high sea sales, and the LPG had to be refilled in cylinders before being sold to customers. After hearing both sides, the main issue was identified as the denial of SAD exemption on the imported LPG.

The Tribunal referred to a previous case where it was held that SAD is not leviable when imported goods are sold as such and bear the burden of sales tax. The Tribunal found that in the current case, the situation was similar to the precedent, and therefore, the demand for SAD on the imported goods was deemed unsustainable. Consequently, the impugned order was set aside, and the appeal was allowed.

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