CESTAT allows refund of 4% SAD on imported adapter plates despite lack of mandatory endorsement under Notification 102/2007-Cus

CESTAT Chennai allowed refund claim for 4% SAD levied under Customs Tariff Act, 1975 on imported adapter plates, power cables and APC receiver. Revenue rejected claim citing lack of mandatory endorsement under Notification 102/2007-Cus. Tribunal relied on Chowgule Company precedent and held that CA certificate with reconciliation statement provided adequate support for refund. Court emphasized that blocking legitimate claims without proper examination causes disservice to trade and should be avoided.

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Issues:
Refund claim rejection based on non-endorsement in invoices for SAD benefit under Notification No. 102/2007-Cus.

Detailed Analysis:
The appellant filed a refund claim for 4% SAD levied under sec. 3(5) of the Customs Tariff Act, 1975 but was rejected by the lower adjudicating authority due to the lack of mandatory endorsement as required under Notification No. 102/2007-Cus. The appellant appealed, arguing that while the invoices submitted did not have the endorsement, the original/duplicate/triplicate copies did contain the necessary declarations. They also provided a certificate from a Chartered Accountant to support their claim that the burden of duty had not been passed on to customers. The appellant relied on the decision in Chowgule & Company Pvt. Ltd. v. CCE, where it was held that non-declaration in the invoice implied no CENVAT Credit availability. Additionally, they cited judgments like Schneider Electric IT Business India Pvt. Ltd. v CC, Noritsu India Pvt. Ltd. v. CC, and Petrotech Products India Pvt. Ltd. v. CC to support their argument.

The Authorized Representative (AR) reiterated the points in the impugned order. Upon hearing both parties, the Tribunal noted that the issue had been settled by the Larger Bench decision in Chowgule & Company, which examined the mandatory compliance of Condition 2(b) of Notification No. 102/2007 for SAD benefit. The Tribunal discussed the genesis and purpose of the levy of Special Additional Duty of Customs (SAD) to provide a level playing field for domestic and imported goods. It highlighted that non-declaration of duty in the invoice itself indicated no credit availability, as per Rule 9 of the CENVAT Credit Rules.

The Tribunal found that the CA's Certificate and reconciliation statement provided by the appellant supported their refund claim. It emphasized that blocking legitimate claims without proper examination of legal developments could harm businesses. Consequently, the impugned order was set aside, and the appeal was allowed with consequential relief as per law. The Tribunal stressed the importance of considering documentary evidence like CA's Certificate for claim scrutiny and avoiding arbitrary denial of claims without proper grounds.

In conclusion, the Tribunal ruled in favor of the appellant, emphasizing the importance of following legal provisions and considering supporting documents like CA's Certificates for refund claims, to ensure fair treatment and avoid undue harm to businesses.

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