Refund of additional customs duty allowed where resale VAT condition was met and circular could not add a new requirement.

Refund of additional customs duty was held admissible where imported goods were resold through a consignment agent and VAT was paid on the resale, because the core condition in the notification was satisfied. The circular could not add a further substantive requirement that VAT must be paid directly out of the importer's own pocket, as an executive clarification cannot override the notification's plain terms. Since the Chartered Accountant's certificate showed reimbursement of VAT to the consignment agent and no rebuttal evidence was produced, the denial of refund was unsustainable. The refund sanction was therefore restored on the basis that the notification had been complied with in substance.

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Issues: Whether refund of 4% additional duty of customs was admissible when the imported goods were sold through a consignment agent who paid VAT and the importer reimbursed the VAT amount, and whether the Board's circular could impose a further condition not found in the notification.

Analysis: The notification granted refund where the imported goods were resold on payment of appropriate sales tax or value added tax. The circular only provided administrative clarification and could not introduce an additional substantive requirement that VAT must be paid out of the importer's own pocket. The record also showed, on the adjudicating authority's finding, that the Chartered Accountant had certified reimbursement of VAT to the consignment agent, and no rebuttal evidence was produced. The essential condition of resale on payment of VAT was therefore satisfied.

Conclusion: The refund claim was admissible and the denial of refund was unsustainable; the assessee succeeded.

Final Conclusion: The appellate order was set aside and the original refund sanction was restored, as the notification's substantive requirement stood fulfilled and no extra condition could be read into it by circular.

Ratio Decidendi: An exemption or refund notification must be construed on its own terms, and an executive circular cannot add a substantive condition not contained in the notification where the core statutory condition is otherwise satisfied.

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