Importer eligible for SAD refund under N/N. 102/2007 despite choosing notification over N/N. 29/2010

CESTAT Bangalore allowed the appeal regarding SAD refund claim on imported goods. The appellant had paid SAD under N/N. 102/2007 and sought refund, which was rejected due to inadequate CA certificate. The Tribunal held that importers could choose between N/N. 102/2007 (covering trading goods) and N/N. 29/2010 (pre-packaged goods) as no restriction existed. Following precedent in Suburban Engineering Works case, the Tribunal ruled that payment of SAD under chosen notification doesn't constitute admission of liability. The appellant was eligible for SAD refund under N/N. 102/2007, and the impugned order was set aside.

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Issues Involved:
1. Rejection of refund claim of Special Additional Duty (SAD) paid on imported goods.
2. Applicability of Notification No. 102/2007 versus Notification No. 29/2010.
3. Validity of Chartered Accountant certificate in refund claims.
4. Requirement to challenge original assessment for refund under Notification No. 102/2007.

Issue-wise Detailed Analysis:

1. Rejection of Refund Claim of Special Additional Duty (SAD) Paid on Imported Goods:

The Appellant imported goods for trading/sale and paid sales tax/VAT as per statutory provisions. They claimed a refund under Notification No. 102/2007 dated 14.09.2007. However, the Adjudication authority rejected the refund claims on 09.01.2013 and 16.01.2013, and the Commissioner (Appeals) upheld these rejections. The Tribunal found that the Appellant was eligible for a refund of SAD under Notification No. 102/2007, as there was no restriction on availing either notification.

2. Applicability of Notification No. 102/2007 Versus Notification No. 29/2010:

The Commissioner (Appeals) held that Notification No. 29/2010-Cus. dated 27.02.2010, superseded by Notification 21/2012-Cus. dated 17.03.2012, applied to pre-packaged goods intended for retail sale. The Appellant argued that Notification No. 102/2007 was not withdrawn or superseded by Notification No. 29/2010, allowing the importer to choose either. The Tribunal agreed, noting that both notifications provided for SAD exemption, and the Appellant's choice was valid. The Tribunal referenced Suburban Engineering Works (Cal.) Pvt., Ltd.-1991 (56) E.L.T. 470 (Tribunal) to support this.

3. Validity of Chartered Accountant Certificate in Refund Claims:

The rejection of the refund claim was also based on the Chartered Accountant certificate not specifying the exclusion of SAD in the MRP/RSP. The Appellant argued that as per Public Notice No. 5/2011 dated 21.01.2011, the certificate format was sufficient and should not be questioned. They also provided balance sheets showing SAD as receivables. The Tribunal accepted this evidence, referencing decisions in M/s Krishan Enterprises Vs. CC (Import), Mumbai - 2009 (237) E.L.T. 708 (Tri.-Mumbai) and M/s Salve Pharmaceuticals Pvt. Ltd. Vs. Commissioner of C.Ex., Delhi.

4. Requirement to Challenge Original Assessment for Refund Under Notification No. 102/2007:

The Revenue argued that without challenging the original assessment, no refund could be claimed, citing Priya Blue Industries Ltd. v. Commissioner of Customs - 2004 (172) E.L.T. 145 (S.C.). The Appellant contended that they were not seeking a change in assessment but a refund under Notification No. 102/2007. The Tribunal noted that reassessment was not required under this notification and referenced Aman Medicals Products Ltd. v. CC-2010 (250) E.L.T. 30 (Del.), which allowed refund claims without challenging the original assessment. The Tribunal found the Revenue's reliance on ITC Ltd. Vs. CCE, Kolkata-IV - 2019 (368) E.L.T. 216 (S.C) misplaced, as it did not apply to the Appellant's situation.

Conclusion:

The Tribunal concluded that the Appellant was eligible for a refund of SAD under Notification No. 102/2007, setting aside the impugned order and allowing the appeal with consequential relief as per law. The judgment emphasized that the Appellant's choice of notification was valid and that the evidence provided was sufficient to support the refund claim.

Order Pronounced:

The order was pronounced in open court on 11.07.2024.

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