2023 (11) TMI 488 - AT - Customs

Tribunal Grants Refund Despite Missing Invoice Endorsement, Prior Orders Overturned for Procedural Non-Compliance.

M/s. LG Electronics India Pvt. Ltd. Versus The Commissioner of Customs (Exports), Chennai

The Tribunal held that the appellant was entitled to a refund under Notification No.102/2007-Cus. despite not having the specific endorsement on the ... Refund of SAD - Rejection for the reason that the invoice did not contain the endorsement “no credit of additional duty of customs levied under sub-section (5) of section 3 of the Customs Tariff Act, 1975 shall be admissible” - HELD THAT:- The issue is settled by the decision of the Tribunal’s Larger Bench in the case of Chowgule & Company Pvt. Ltd. Vs CC & CCE [2014 (8) TMI 214 - CESTAT MUMBAI (LB)] where it was held that A trader-importer, who paid SAD on the imported .good and who discharged VAT/ST liability on subsequent sale, and who issued commercial invoices without indicating any details of the duty paid, would be entitled to the benefit of exemption under Notification 102/2007-Cus., notwithstanding the fact that he made no endorsement that “credit of duty is not admissible” on the commercial invoices, subject to the satisfaction of the other conditions stipulated therein. Thus, the rejection of refund claim is not justified. Impugned order is set aside - Appeals are allowed. Issues involved: The issue in this case is whether the appellant is eligible for a refund under Notification No.102/2007-Cus. despite the absence of a specific endorsement on the invoices as required by para 2(b) of the said notification.Summary of Judgment:Issue 1 - Eligibility for refund under Notification No.102/2007-Cus.: The appellant filed a refund claim for SAD paid at the time of import of goods, which was rejected by the original authority due to the missing endorsement on the invoices. The Commissioner (Appeals) upheld the rejection, leading to the current appeal. The appellant argued that as a trader, they could not pass on the credit to any person, citing a relevant decision. The Department supported the original decision. The Tribunal referred to previous decisions and concluded that the condition of the endorsement on the invoice was procedural, and the purpose could be achieved even without it if the duty element was not specified. Therefore, the appellant, who paid SAD and issued invoices without duty details, was entitled to the exemption under the notification. The Tribunal held that the rejection of the refund claim was not justified and set aside the impugned order, allowing the appeals with consequential relief.This judgment clarifies the eligibility criteria for a refund under Notification No.102/2007-Cus., emphasizing the importance of fulfilling substantive conditions over procedural requirements, especially when the objective of the exemption can still be met without strict compliance with technicalities.