SEZ unit refund of Special Additional Duty allowed where import status, VAT payment, and notification conditions were satisfied.

A Special Economic Zone unit supplying imported goods to the Domestic Tariff Area was held entitled to refund of Special Additional Duty under Notification No. 102/2007-CUS. The analysis treated the unit as an importer under Section 2(26) of the Customs Act, 1962, and held that Rule 48(1) of the SEZ Rules did not exclude such a unit where the bill of entry was filed on authorisation. As the SAD had been paid and not recovered from the DTA buyer, and VAT had been paid on the subsequent sale, the notification conditions were satisfied.

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Issues: Whether the appellant, a Special Economic Zone unit supplying imported goods to the Domestic Tariff Area, was entitled to refund of Special Additional Duty under Notification No. 102/2007-CUS dated 14.09.2007.

Analysis: The refund notification was applied in light of the Customs Act definition of importer and the SEZ procedure for clearance to the Domestic Tariff Area. The goods were originally imported by the appellant and remained under import status until clearance for home consumption. The definition of importer in Section 2(26) of the Customs Act, 1962 was read to include the appellant, and Rule 48(1) of the Special Economic Zones Rules, 2006 did not exclude the SEZ unit where the bill of entry was filed on authorization. Since the SAD had been paid and not recovered from the DTA buyer, and VAT had been paid on the subsequent sale, the conditions of the notification were satisfied.

Conclusion: The appellant was entitled to refund of Special Additional Duty under Notification No. 102/2007-CUS dated 14.09.2007.

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