TaxTMI 
TaxTMI 
2025 (10) TMI 831
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....200930 dated 22.05.2013, 2201017 dated 22.05.2013, 2255268 dated 28.05.2013, 2483288 dated 20.06.2013, 9120282 dated 24.01.2013, 9665419 dated 25.03.2013 and 9962012 dated 26.04.2013. 2.2 The Appellant submitted the following documents along with the refund claim: - i. 07 Original Importer's copies of Bills of Entry [two original and others photocopy] ii. 06 Original TR6 Challans for 6 Bills of Entry No. 2201017 dated 22.05.2013, 2255268 dated 28.05.2013, 2483288 dated 20.06.2013, 9120282 dated 24.01.2013, 9665419 dated 25.03.2013 and 9962012 dated 26.04.2013. TR6 Challan for bill of entry No.2200930 was not submitted. iii. Copies of Sales Invoices iv. Copies of VAT Acknowledgements v. Statutory Auditor's Certificate ruling out Unjust Enrichment vi. Indemnity Bond for 5 Bills of Entry misplaced by them 2.3 The Adjudicating Authority randomly verified certain sales invoices at buyers end and found that in three sales invoices, the mandatory endorsement as per para 2(b) of Notification No. 102/2007-Customs dated 14.09.2007 was not imprinted or stamped. The entire refund claim was rejected for non-fulfilment of the condit....
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....set aside in its entirety with consequential relief to the Appellant: - i. M/s. Venner Mills Vs. The Commissioner of Customs ii. M/s. Faxtel System (India) Vs Commissioner of Customs, Bangalore iii. M/s. Ganesh Impex Vs Commissioner of Customs, Chennai iv. M/s. Johnsons Lifts Pvt. Ltd. Vs Commissioner of Customs, Chennai [2020 (374) ELT 519 (Mad)] v. M/s. P.P. Products Ltd. Vs Commissioner of Customs, Chennai [2019 (367) ELT 707 (Mad)] 5. Per contra, the Ld. Authorized Representative Mr. N. Satyanarayana for the Revenue supported the findings in the impugned order. He submitted that both the adjudicating authority and the LAA have found that the sales invoices submitted by the Appellant and randomly verified at buyers end did not contain the mandatory endorsement as per the condition in para 2(b) of notification No. 102/2007-Cus., dated 14.09.2007. Therefore, they have rightly rejected the refund claim of the Appellant. 6. Heard both sides and perused the appeal records. 7. The issues to be decided in this case are: - i. Whether the sales invoices submitted by the Appellant contained the endorsement as per para 2(b) of ....
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....reads as follows : "Whether to avail the benefit of Notification No. 102/07, the condition 2(b) of the Notification is mandatory for compliance being a trader who cleared the goods on the strength of commercial invoice." 2. The reference has been made in the facts and circumstances detailed below : 2.1. The appellant, a trade, imported goods on which the discharged special additional duty of customs under Section 3(5) of the Customs Tariff Act, 1975. The said goods were sold on payment of CST/VAT under commercial invoices. In the said commercial invoice, the appellant did not indicate of SAD element separately. The appellant also did not make any endorsement on the invoice to the effect that no cenvat credit of the SAD is admissible in respect of the goods covered therein. The appellant claimed benefit under Notification 102/2007-Cus dated 14.09.2007 which reads as follows : "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 Custo....
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....) ELT 252. In these two decisions, it was held that in where the trader issues a commercial invoice without making the endorsement as stipulated in paragraph 2(b) of the notification and quantum of SAD paid is not specifically mentioned in the invoices, SAD paid should not be denied merely because the required endorsement was not made as that would constitute only a technical infraction. The purpose of clause (b) of para 2 of the Notification is to prevent availing of double benefit, i.e., the buyer of the goods takes the credit of SAD paid while the seller gets refund) of the SAD paid. It was noted that in the case of a trader, who is not registered with the department and who is also not authorised to issue CENVATable invoices and who does not indicate in the commercial invoice the details of the SAD paid, the question of taking any credit would not arise inasmuch as commercial invoices issued by a non-registered trader is not a document on the strength of which CENVAT could be availed md in the absence of duty particulars thee question of taking any CEKVAT credit also would not arise. Therefore, it was held that even if (he trader did not make the endorsement las envisaged under....
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....l also not apply to input imported under export-promotion schemes. In addition, there may be other sectors eligible for exemptions. These would be examined and if considered appropriate notified separately." The rate of levy was subsequently reduced to 4% All goods imported for subsequent sale were initially exempted from levy of SAD vide Sl. No. 11 of the Table Annexed to notification No. 29/98-Cus dated 2-6-1998. The said exemption underwent many changes over the years and the present exemption is contained in notification 102/2007-Cus wherein the exemption is operationalised through a refund mechanism. Notwithstanding these changes, the object of the levy was to counterbalance the levy of local taxes on domestically produced goods on imported goods so that there is a level playing field between the two. However, when the imported goods are subsequently sold in the domestic market bearing the burden of local taxes, exemption is provided from SAD so as to neutralize the impact of double levy. This object and purpose of the levy and the exemption needs to be kept in mind while interpreting notification No. 102/2007-Cus. 5.2. Rule 9 of the CENVAT Credit Rules presc....
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....the facts of the case before us, it can be seen that the condition relating to endorsement on the invoice was merely a procedural one and the purpose and object of such an endorsement could be achieved when the duty element itself was not specified in the invoice. Since the object and purpose of the condition is achieved by non-specification of the duty element the mere non-making of the endorsement could not have undermined the purpose of the exemption. Thus we concur with the view taken by this Tribunal in the cases of Equinox Solution Ltd. and Nova Nordisk India Pvt. Ltd. (supra). 5.4. In view of the factual and legal analysis as above, we answer the reference made to us as follows. A trader importer, who paid SAD on the imported goods and who discharged VAT/ST liability on subsequent sale, and who issued commercial invoices without indicating any details of the duty paid, would be entitled to the benefit of exemption under Notification 102/2007-Cus, notwithstanding the fact that he made no endorsement that "credit of duty is not admissible" on the commercial invoices, subject to the satisfaction of the other conditions stipulated therein. The above decision is rendered....