TaxTMI 
TaxTMI 
TaxTMI 
2023 (4) TMI 786
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.... under some other Bill of Entry, a search was carried out at the business premises of the appellants by the DGCEI. On the basis of the DGCEI's investigation report, show cause notices were issued to the Appellants. In adjudicating, the adjudicating authorities took the view that the appellants have submitted forged documents with the customs authority with a view to get the refund fraudulently. They did not declare the factual position and suppressed the material facts i.e. clearance of different timber which did not pertain to the Bill of Entry for which they claimed refunds, preparation of forged invoices etc. These facts come to the notice of the department only after initiation of investigation against them. By adopting such modus operandi they received amounts, which otherwise would not have been sanctioned to them and thereby they contravened the provisions of Section 27 of Customs Act, 1962 read with the provisions of Notification No. 102/2007-Cus dated 14.09.2007. Therefore, extended period of recovery of refunds so sanctioned erroneously to them were invoked in these cases. The adjudicating authority passed the following impugned orders by denying the benefit under Notific....
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....Bill of Entry Number over the invoices issued to customer, the customers would have easily known the price of imported goods, which would impact on the business of the Appellant. Appellant did not own any saw mill and used the Gandhidham premises only for storage of imported timber logs. The revenue failed to appreciate the fact that the Appellant imported round as well as sawn timber and sold the same after paying duty and therefore the condition of the Notification are satisfied. 3.2 He further submits that revenue has to appreciate that the Appellant filed the refund claim before the Customs authority along with all the requisite documents. The Appellant even annexed a statement showing details of import of timbers and clearances of the same to the customers on payment of VAT/Sales Tax and the statement was duly certified by the Appellant. This fact demonstrates that even though CBM was differently mentioned over the invoices submitted to the forest department and supplied to customers, it does not mean that the appellant did not sell the imported timber. Appellant complied with all the conditions of Notification No. 102/2007 and therefore, the revenue erred in demanding refund....
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....s of the statement do not reveal that Appellant had fraudulently filed refund claim to obtain refund of SAD. The appellant did not alter the details of invoice number and date, quantity and rate, description of the goods, value of the goods, details of buyers and amount of VAT/Sales Tax paid. Not having endorsement of Bill of Entry Number does not mean that the appellant did not comply with the conditions of the said Notification. The revenue ought to have appreciated that the Notification does not have any condition regarding endorsement of Bill of Entry number over the invoices submitted to the customers. In absence of such conditions, the revenue cannot add any condition by way of circular or order. 3.6 He also argued that Learned Commissioner (Appeals) ought to have appreciated that refund orders passed by the Assistant Commissioner (Refund) attained finality. The Assistant Commissioner after going through all the conditions of the Notification and documents submitted by the appellant held that the appellant were eligible for refund and the said order has not been challenged further. Since the refund order attained finality , the department ought not have issued the show cause....
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....jected by the authorities. 05. I have heard both the sides and perused the records carefully. The issue involved is whether the appellants are eligible for the refund of SAD paid on imported timber under Notification No. 102/2007. The relevant notification reads as follows :- "GOVERNMENT OF INDIA MINISTRY OF FINANCE (DEPARTMENT OF REVENUE) 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 Schedule to the Customs Tariff Act, 1975 (51 of 1975), when imported into India for subsequent sale, from the whole of the additional duty of customs leviable thereon under sub-section (5) of section 3 of the said Customs Tariff Act (hereinafter referred to as the said additional duty). 2. The exemption contained in this notification shall be given effect if the following conditions are fulfilled : (a) the importer of the said goods shall pay all duties, including the said additional duty of custo....
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....rieved by the Order-In-Appeal dated 14.03.2013 revenue further taken up the matter before the CESTAT and the CESTAT vide order dated 30.10.2013 upheld the sanction of the refund and dismissed the revenue's appeal. The said tribunal's order was not further challenged by the revenue therefore, the orders sanctioning the refund attained finality. In this circumstances, the refund sanctioned by the original authority being attained finality upto the CESTAT cannot be called as erroneous refund therefore, the proceeding for recovery of the said refund treating as erroneous is absolutely illegal and unwarranted in the eyes of law. In the present matters Show cause notices have been issued under Section 28 of the Customs Act to recover the amount refunded vide earlier Orders with the presumption that the refund was erroneously granted to the assessee. The issue whether or not the refund has been erroneously granted would have to be decided in the manner provided in law. Since the sanction of refund has been held legal and correct as per the tribunal's order, the said refund cannot be treated as erroneous therefore, no show cause notice should have been issued consequently, no order for rec....
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....ned, as such the aforesaid issue is now not res integra in view of the direct decision of this Court in the case of Asian Paints (India) Ltd. (supra). 7.3 In the case of Asian Paints (India) Ltd. (supra), the decision which has been rendered subsequent to the decision of the High Court in the case of Bajaj Auto Ltd (supra) it is observed and held as under: "We have read the judgments of the larger Bench of the Customs, Excise and Gold (Control) Appellate Tribunal, which are impugned in these appeals. We are of the view that the judgments viewed Section 35-E and 11-A of the Central Excise Act in the proper perspective. The two sections operate in different fields and are invoked for different purposes. Different time-limits are, therefore, set out therein. We do not accept the contention that recovery of excise duty cannot be made pursuant to an appeal filed after invoking the provisions of Section 35-E, if the time limit provided in Section 11-A has expired. To so read the provisions, would be to render Section 35-E virtually ineffective, which would be impermissible." 7.4 Before this Court in the case of Asian Paints (India) Ltd. (supra) the judgments of the larger Bench ....
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....und and if at all the same is required to be recovered, it is that very order which is to be taken in appeal before the higher court otherwise, no recovery of the refund can be made by way of issuing another show cause notice and order for recovery in the said show cause notice. In the present case, when the refund sanctioning order has been upheld upto the CESTAT and no further appeal was preferred by the revenue, the revenue could not have proceeded for recovery by issuing a fresh show cause notice therefore, in view of the above Hon'ble Apex Court judgment, the action of the revenue for recovery of so called erroneous refund in the present case is absolutely illegal. Somewhat similar issue has been considered by the Hon'ble Madras High Court in the case of M/s. Eveready Industries India Ltd. v. CESTAT, Chennai - 2016-TIOL-676 HC-Mad-CX = 2016 (337) E.L.T. 189 (Mad.).The issue that came up for consideration in the said case before the Hon'ble High Court was whether department can recover refund by invoking provisions of Section 11A without exercising the power of review under Section 35E and the order of refund not being reviewed by a superior officer. The Court referred to the c....
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....under:- (1) Sales Tax/VAT has been paid on the goods in respect of refund was claimed; (2) Burden of 4% SAD has not been passed; (3) The amount of refund has been shown as receivable and reflected in balance sheet 5.3 Further, while the refund claim were sanctioned to the Appellants the Refund sanctioning authority also verified the said facts and also observed that the conditions of Notification fulfilled by the appellants. Hence, clearly in the present matter department erred in demanding sanctioned refund of SAD from the Appellants. 5.4 I also find that in the case of Agarwalla Timbers Pvt. Ltd. Vs Commissioner Of Customs, Kandla - 2014 (299) E.L.T. 455 (Tri. - Ahmd.)Tribunal held that the benefit of exemption Notification No. 102/2007 cannot be denied merely the imported goods were of logs whereas the same were sawn and sold in DTA. It was held that logs even after sawn, remains the same. The said decision was further challenged by the Revenue before the Hon'ble Gujarat High Court whereby the Hon'ble Gujarat High Court in case of Commissioner Of Customs Versus Variety Lumbers Pvt. Ltd. - 2014 (302) E.L.T. 519rejected the Department's appeal by observing as under: "32.....