Nil Sales Tax or VAT can satisfy Notification 102/2007-Cus. conditions, preserving Special Additional Duty refund entitlement.

For Condition No. 2(d) of Notification No. 102/2007-Cus., nil Sales Tax/VAT/CST can satisfy the requirement of appropriate duty paid where the importer otherwise establishes compliance with the notification. The Tribunal followed its earlier interpretation of the scheme, noting that its object is to prevent double taxation and keep importers on a level footing. On that basis, refund of Special Additional Duty could not be denied merely because sales tax or VAT was not shown as paid in the invoices, and the refund claim was restored with consequential relief.

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Issues: Whether refund of Special Additional Duty of Customs under Notification No. 102/2007-Cus. could be denied for alleged non-fulfilment of Condition No. 2(d) where Sales Tax/VAT/CST was nil or otherwise treated as appropriate duty.

Analysis: The Tribunal followed its earlier decision on the same notification and held that the object of the exemption scheme was to avoid double taxation and to place importers on a level footing. It was held that, for Condition No. 2(d), a nil rate of Sales Tax/VAT/CST is to be treated as appropriate duty where the importer establishes compliance with the notification. On that basis, the refund could not be rejected on the ground that sales tax or VAT had not been paid in the invoices.

Conclusion: The refund under Notification No. 102/2007-Cus. was held admissible and the denial of refund was set aside, in favour of the assessee.

Final Conclusion: The appeal succeeded and the refund claim was restored with consequential relief as per law.

Ratio Decidendi: For the purpose of Condition No. 2(d) of Notification No. 102/2007-Cus., nil Sales Tax/VAT/CST can satisfy the requirement of appropriate duty paid, so refund of Special Additional Duty cannot be denied on that basis alone.

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