TaxTMI 
TaxTMI 
2018 (1) TMI 175
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....appropriate VAT for the sale invoices and in the said case, since impugned gods were exempted, the question of payment of VAT/CST does not arise. 2. Today, when the matter came up for hearing, on behalf of the appellants, Ld. Advocates/consultant submitted that the issue involved in these appeals have been settled by the Tribunal in Kubota Agricultural Machinery India Pvt. Ltd. and Acer India Pvt. Ltd. Vs CC Chennai-IV as reported in 2017 (6) TMI 565-CESTAT Chennai which laid down that, if the appropriate rate of Sales Tax/VAT was Nil, then the appropriate Sales Tax / VAT will also to be Nil and the importers concerned would be very much eligible for the refund in such cases. 4. On the other hand, on behalf of department, Ld. A.Rs opposed the appeals. 5. Heard both sides. On going through the facts, we find that the Ld.Advocate/Consultant are correct in their assertion that the matter is no longer res integra. The relevant portions of the Kubota Agricultural Machinery decision cited by ld. advocates is reproduced below :- "5. We have heard both sides and have gone through the records. 6.1 Special Additional Duty (SAD) that is under discussion has been mandated by section 3(5....
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.... the domestic industry. 121. I have given my earnest consideration to these concerns and the competing claims. I am persuaded about a clear disability that our commodity taxation inflicts on the indigenous goods vis-`-vis the imported goods. While the former are subjected to sales tax and other local taxes and levies, the import sector, escapes them by their very nature. In order to provide a level playing-field to the domestic industry, I propose to impose an additional non-modvatable levy of 8% on imports which is approximately equal to the burden of local taxes on domestic producers. This duty should not be viewed as a protectionist measure but only as a response to a legitimate demand for a level playing-field. The new levy would not apply to crude oil, newsprint, capital goods sector under a special tariff regime or goods which are subjected to additional duties of excise in lieu of sales tax, gold and silver imported by passengers or other nominated agencies and life saving drugs that are free from customs duties. The levy would also not apply to goods which are currently exempt both from basic and additional duties of customs. Similarly, goods imported for subsequent tradi....
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....the refund papers. Notification No. 102/2007, dated 14-9-2007 as amended allowed refund of SAD subject to the condition that the importer shall pay appropriate sales tax or VAT, as the case may be. In the present case, the appropriate sales tax or VAT being NIL the appellants cannot be said to have violated the said conditions of the said notification inasmuch as it cannot be said that they have not paid appropriate sales tax/VAT. In this regard, it is seen that vide Circular No.6/2008, dated 28-4-2008 C.B.E. & C. in para 5.3 thereof clarified as under : "5.3 The exemption contained in the said notification envisages that the importer shall file a refund claim for 4% CVD ( said additional duty of Customs ) paid on imported goods and shall pay on sale of the said goods appropriate Sales Tax or VAT as the case "may be". Hence, it is clear that there is no stipulation in the notification that the exemption is available only if the rate of ST/VAT is equal to or higher than the rate of additional duty of Customs; nor is there a condition that if the rate of ST/VAT happen to be lower than 4%, the refund would be restricted to the lower amount. As such, it is clarified that it will not ....
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....be postponed for administrative convenience to the date of removal of goods from the factory. Rule 9A of the said rules merely does that. That is the scheme of the Act. It does not, in our opinion, make removal be the taxable event. The taxable event is the manufacture. But the liability to pay the duty is postponed till the time of removal under Rule 9A of the said Rules. In this connection, reference may be made to the decision of the Karnataka High Court in Karnataka Cement Pipe Factory v. Superintendent of Central Excise - [1986 (23) E.L.T. 313] where it was decided that the words `as being subject to a duty of excise appearing in Section 2(d) of the Act are only descriptive of the goods and not to the actual levy. `Excisable goods', it was held, do not become non-excisable goods merely by the reason of the exemption given under a notification. This view was also taken by the Madras High Court in Tamil Nadu (Madras State) Handloom Weavers Co-operative Society Ltd. v. Assistant Collector of Central Excise - [1978 (2) E.L.T. (J 57)]. On the basis of Rule 9A of the said rules, the Central Excise authorities were within the competence to apply the rate prevailing on the date of....