Refund of Special Additional Duty cannot be denied for payment through duty credit scrips where the notification imposes no cash-payment .

Special Additional Duty refund under Notification No. 102/2007-Cus could not be denied merely because the duty was paid through duty credit scrips. The notification did not require cash payment as a condition for refund, and Board circulars could not create a substantive restriction not found in the notification. Those circulars only regulated the preference for cash payment and the manner and time for use of re-credited scrips. Procedural limits on re-credit could not override the refund benefit otherwise available under the exemption notification.

---

---

Issues: Whether refund of Special Additional Duty under Notification No. 102/2007-Cus could be denied on the ground that the duty had been paid through duty credit scrips and the re-credited amount was subject to the time limits in the Board circulars.

Analysis: The refund claim arose under Notification No. 102/2007-Cus, which did not prescribe a condition that SAD must necessarily be paid in cash. The Board circulars relied on by Revenue only expressed a preference for cash payment to ensure expeditious refund and regulated the manner and period of utilization of re-credited scrips. They did not create a substantive bar against refund where SAD had been paid through duty credit scrips before the circular dated 29.04.2013. The procedural stipulations regarding re-credit and its utilization could not be used to deny the underlying refund benefit otherwise available under the notification.

Conclusion: The refund by re-credit was permissible, and the Revenue's challenge failed.

Ratio Decidendi: A departmental circular cannot take away a refund benefit conferred by an exemption notification, and procedural conditions relating to re-credit or its utilization cannot be used to deny the substantive refund where the notification itself imposes no such cash-payment requirement.

---