TaxTMI 
TaxTMI 
2019 (11) TMI 1286
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....er under a tax/VAT invoice but where the rate of VAT applicable is nil, the appellant is entitled to refund of SAD paid under Notification No. 102/2007-CUS or otherwise. Learned Counsel for the appellant submits that in their own case with respect to the earlier appeals an order was passed in their favour holding that they are entitled to refund of SAD vide Final Order No. A/30793-30796/2019 dated 03.10.2019 relying on the order of Principal Bench of CESTAT in the case of Gazal Overseas [2016 (332) ELT 767 (Tri-Del)]. On examining the case records, I find it so. The relevant parts of the earlier order are reproduced below: 3. The appellant herein imported goods on payment of appropriate duties of customs including Special Additiona....
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.... the Revenue that in the case of Dhiren Chemical Industries [2002(139)ELT 3 (SC), Hon'ble Supreme Court has held that where an exemption is extended, subject to the condition that appropriate duty has been paid on the raw material then such exemption shall not be available when the raw material is not liable to excise duty or where such duty is 'nil'. CBEC has issued a Circular No. 667/58/2002-CX dated 26.09.2002 citing the above judgement of the Hon'ble Apex Court and instructing that whenever an exemption is subject to the condition that appropriate duty of excise has been paid on the inputs, the exemption will not be available if the inputs are exempted from excise duty or such duty is 'nil'. Accordingly, the Revenue filed appeals before....
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....ot change with the rate of VAT. The exemption notification nowhere specifies the rate at which VAT on the imported goods to be paid when the goods are subsequently sold. While the SAD is uniformly levied at 4%, the applicable VAT on such goods could be high say, 12% or low say 0%. The notification does not make a distinction between these cases on the basis of the rate of VAT applicable on the goods. Similarly, the rate of SAD is only 4% regardless of the exact rate of VAT applicable to the goods. 6. If, for instance, the appropriate rate of VAT is 12% and imported goods suffer only 4% SAD the field is not completely even. On the other hand, if the appropriate rate of VAT is 2% and SAD is levied at 4% the domestic manufacturer gets....
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....he 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 be appropriate to reduce the refund amount in such a situation and the entire 4% CVD, if otherwise found eligible, shall be refunded". It is evident from the above clarification of C.B.E. & C. that even if VAT/Sales tax was less than 4%, the appellant was entitled to refund of SAD which was 4% so long as VA....