Substantial compliance for SAD refund under Notification 102/2007-Cus defeats denial based on invoice-format discrepancies.

Refund of Special Additional Duty under Notification No. 102/2007-Cus could not be denied merely because invoices showed format or presentation differences, where the assessee established payment of SAD, subsequent sale of the imported goods on VAT or sales tax, correlation between imports and sales, and non-passing of the duty burden. The paragraph 2(b) endorsement requirement was treated as substantively satisfied on the record, and the alleged defect was only procedural or evidentiary. On that basis, substantial compliance with the beneficial notification was accepted and rejection of the refund claims was held unsustainable.

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Issues: Whether the appellant complied with paragraph 2(b) of Notification No. 102/2007-Cus dated 14.09.2007 so as to claim refund of Special Additional Duty paid on import, and whether rejection of the refund claims on the ground of invoice-format discrepancies and alleged absence of the prescribed endorsement was sustainable.

Analysis: Notification No. 102/2007-Cus grants refund of SAD subject to the condition in paragraph 2(b) that the sales invoice must indicate that credit of the additional duty of customs under Section 3(5) of the Customs Tariff Act is not admissible. The essential facts were established: SAD was paid at import, the goods were subsequently sold on payment of VAT or sales tax, and Chartered Accountant certificates and other records showed correlation between imports and sales and non-passing of duty incidence. The dispute was confined to variations in invoice format and presentation. Such differences, by themselves, did not prove omission of the declaration, especially when there was no finding that buyers had availed SAD credit or that the duty burden had been passed on. The condition was substantive in purpose but the defect alleged was only procedural or evidentiary, and refund under a beneficial notification could not be denied on hyper-technical grounds when substantial compliance was shown.

Conclusion: The appellant had substantially complied with paragraph 2(b) of Notification No. 102/2007-Cus dated 14.09.2007, and rejection of the refund claims on the basis of invoice-format discrepancies was not sustainable. The refund claims were allowed.

Ratio Decidendi: Refund under a beneficial SAD exemption notification cannot be denied for mere procedural or formatting discrepancies in invoices where payment of SAD, subsequent sale on VAT, correlation of goods, and non-passing of duty incidence are otherwise established.

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