TaxTMI 
TaxTMI 
2018 (2) TMI 35
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.... Pvt. Ltd., 2016 (333) ELT 33. Other prayers are also made. 2. The petitioner is a company incorporated under the laws of India and is a manufacturer, importer and seller of products like mobile phones etc. 3. The petitioner had imported goods vide 38 Bills of Entry and at the time of clearance for home consumption during the period 12th July, 2013 to 19th March, 2014, paid Special Additional Duty (SAD) of Rs. 3,96,39,212/- under sub-section (5) of Section 3 of the Customs Tariff Act, 1975 in addition to basic and additional customs duty leviable under Section 3(1) of the Customs Act. 4. SAD is in nature of counter-balancing duty, to account for sales tax, value added tax, etc. 5. Notification No.102/2007-Cus dated 14th September, 2007 issued under Section 25 (1) of the Customs Act grants exemption from payment of SAD on all goods imported for subsequent sale falling in the First Schedule of the Customs Tariff Act, 1975, when Value Added Tax/Sales Tax is paid by the importer. This notification has been quoted below. 6. It is undisputed that the petitioner is entitled to the benefit of the said exemption notification in respect of 38 Bills of Entry cleared for home co....
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....der, as the case may be.] [(3) An exemption under sub-section (1) or subsection (2) in respect of any goods from any part of the duty of customs leviable thereon (the duty of customs leviable thereon being hereinafter referred to as the statutory duty) may be granted by providing for the levy of a duty on such goods at a rate expressed in a form or method different from the form or method in which the statutory duty is leviable and any exemption granted in relation to any goods in the manner provided in this sub-section shall have effect subject to the condition that the duty of customs chargeable on such goods shall in no case exceed the statutory duty. Explanation.- "Form or method", in relation to a rate of duty of customs, means the basis, namely, valuation, weight, number, length, area, volume or other measure with reference to which the duty is leviable.] [(4) Every notification issued under sub-section (1) or sub-section (2-A) shall, unless otherwise provided, come into force on the date of its issue by the Central Government for publication in the Official Gazette.] (5) [* * *] [(6) Notwithstanding anything contained in this Act, no duty shall be collected if....
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....his section, the period of limitation of one year shall be computed in the following manner, namely:- (a) In the case of goods which are exempt from payment of duty by a special order issued under subsection (2) of section 25, the limitation of one year shall be computed from the date of issue of such order; (b) Where the duty becomes refundable as a consequence of any judgment, decree, order or direction of the appellate authority, Appellate Tribunal or any court, the limitation of one year shall be computed from the date of such judgment, decree, order or direction; (c) Where any duty is paid provisionally under section 18, the limitation of one year shall be computed from the date of adjustment of duty after the final assessment thereof or in case of re-assessment, from the date of such re-assessment.] (2) If, on receipt of any such application, the [Assistant Commissioner of Customs or Deputy Commissioner of Customs] is satisfied that the whole or any part of the 3[duty and interest, if any, paid on such duty] paid by the applicant is refundable, he may make an order accordingly and the amount so determined shall be credited to the Fund: Provide....
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....te, there shall be paid to the applicant interest under this section from the date immediately after three months from such date, till the date of refund of such duty. Explanation. - Where any order of refund is made by the Commissioner (Appeals), Appellate Tribunal, National Tax Tribunal or any court against an order of the Assistant Commissioner of Customs or Deputy Commissioner of Customs under sub-section (2) of section 27, the order passed by the Commissioner (Appeals), Appellate Tribunal, National Tax Tribunal or, as the case may be, by the court shall be deemed to be an order passed under that sub-section for the purposes of this section." 9. We would also like to reproduce Notification No.102/2007-Cus. dated 14th September, 2007 and the relevant portion of Circular No.6/2008-Cus. dated 28th April,2008, which read as under:- "Notification No. 102/2007-Customs New Delhi, the 14th September, 2007 G.S.R. (E).- In exercise of the powers conferred by sub-section (1) of section 25 of the Customs Act, 1962 (52 of 1962), the Central Government, on being satisfied that it is necessary in the public interest so to do, hereby exempts the goods falling within the First Sc....
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....despatched for sale to different parts of the country and that the importer may find it difficult to dispose of the imported goods and complete the requisite documentation within the normal period of six months. Taking into account various factors, it has been decided to permit importers to file claims under the above exemption upto a period of one year from the date of payment of duty. Necessary change in the notification is being made so as to incorporate a specific provision prescribing maximum time limit of one year from the date of payment of duty, within which the refund could be filed by any person. It is also clarified that the importers would be entitled to refund of duties only in respect of quantities for which the prescribed documents are made available and the claims submitted within the maximum prescribed time of one year. Unsold stocks would not be eligible for refunds. 4.2. **** 4.3. With the extension of time limit and the requirement to file claims on a monthly basis, Board feels that the number of refund claims should be manageable for disposal within the normal period of three months. Further, in the absence of specific provision for payment of interest be....
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....hree months from date of receipt of application under sub section 1 to section 27, interest would be paid by the authorities as per the rate specified. In other words, if the refund is paid within three months of date of receipt of application under sub section 1 to Section 27, no interest is payable. Interest is payable on delayed refunds after three months post the application for refund till the date of refund. Section 27A therefore ensures prompt decision and payment of refunds, when due and payable under sub section 2 of Section 27 of the Act. 14. We need not refer to the other portions of Sections 25, 27 and 27A of the Customs Act for the purposes of this decision. 15. The expression 'duty' used in clauses (a) to (h) of subsection 2 to Section 27 of the Customs Act was interpreted in Riso India Pvt. Ltd. (supra), and in our opinion rightly, as wide enough to cover all kinds of customs duties as per the definition clause Section 2(15) of the Customs Act. Duty would include SAD. This decision also refers to Section 3(8) of the Customs Tariff Act, which stipulates that provisions of the Customs Act, including those related to drawback, refunds and exemptions shall ....
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....ng paragraph 4.3 of Circular No. 6/2008 dated 28th April, 2008, direction was given to pay interest in terms of Section 27A of the Customs Act. The reason was and the Division Bench has held that paragraph 4.3 of the Circular No.06/2008 dated 28th April, 2008 was not in consonance with and in accord with statutory mandate of Section 27A, which was applicable to refund payable under Notification No. 102/2007. 19. A similar issue had arisen before the Madras High Court in KSJ Metal Impex (P) Ltd. Vs. Under Secretary (CUS.), M.F. (D.R.), 2013 (294) ELT 211 (Mad.). This decision also refers to the relevant provisions and, in particular, to Section 3 (5) of the Customs Tariff Act, which provides for levy of SAD to counterbalance sales tax, value added tax, local tax etc. and exemption Notification No.102/2007-Customs dated 14th September, 2007, by which exemption from payment of SAD on imported goods was granted on specified terms and conditions. Reference is also made to Section 3 (8) of the Customs Tariff Act, which states that the provisions of the Customs Act, in relation to refund are applicable to SAD. Thereafter, it has been held as under:- "10. The petitioner, therefore, i....
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.... is granted by the provisions of the Customs Act, 1962 and Customs Tariff Act, 1975. Therefore, paragraph 4.3 of the Circular No.6/2008-Customs, dated 28.4.2008 is contrary to the statute and becomes totally inappropriate. When the circular is contrary to the provisions of the Customs Act, 1962 and Customs Tariff Act, 1975, it has to be struck down as bad. 13. For the foregoing reasons, the writ petition is allowed and paragraph 4.3 of the Circular No.6/2008-Customs, dated 28.4.2008 insofar as it seeks to restrict or obliterate the claim of interest on belated refunds granted in terms of Notification No.102/2007-Customs, dated 14.9.2007 is quashed and the pending refund application of the petitioner shall be considered by the respondents in the light of Sections 27 and 27A of the Customs Act, 1962. No costs. Consequently, M.P.No.1 of 2013 is closed." 20. We respectfully agree with the reasoning given in KSJ Metal Impex (P) Ltd. (supra), which is in consonance with the reasoning given by this Court in Riso India Pvt. Ltd. (supra). 21. The result would be that paragraph 4.3 of the Circular No.06/2008Cus. dated 28th April, 2008 has to be struck down. The said circular does no....