2011 (8) TMI 1098 - AT - Customs

Refund claim - SAD - N/N. 102/2007-Cus. dated 14.09.2007 - denial on the ground that the applicant, while issuing the invoice for sale of the imported goods, did not specifically indicate in the invoice that no credit of additional duty of customs levied under sub-section (5) of Section 3 of the CTA was admissible - Held that - the applicant is not a registered dealer for the purpose of passing of credits. Further, the invoices produced for our perusal, which have been relied upon by the Commissioner (Appeals), do not indicate any amount of Customs Duty separately and, therefore, the basis of fear that these documents could have been used for taking credit does not exist - petition dismissed - decided against Revenue.

Summary

Issues:
1. Refund claim of Special Additional Duty (SAD) paid on imported goods.
2. Rejection of refund claim by the original authority due to lack of specific indication in the invoice.
3. Allowance of refund by the Commissioner (Appeals).
4. Eligibility of invoices issued by the applicant for taking credit by buyers.
5. Verification of invoices and satisfaction of conditions for availing exemption.

Analysis:
The judgment pertains to a case where the applicant imported Generator parts as a trader and subsequently sold the goods after paying applicable VAT. The applicant sought a refund of the Special Additional Duty (SAD) paid under Notification No. 102/2007-Cus. The original authority rejected the claim citing the absence of a specific indication in the invoice regarding the inadmissibility of credit for the additional duty of customs. However, the Commissioner (Appeals) overturned this decision and allowed the refund of the SAD component.

The consultant representing the applicant argued that the applicant was not a registered dealer with the Central Excise Department, making the invoices ineligible for buyers to claim credit. Sample invoices presented did not mention any Customs Duty details, including the SAD component, making it impossible for buyers to avail any credit.

On the other hand, the SDR contended that the condition for exemption required an endorsement in the invoices by the importer, which was not fulfilled in this case. Additionally, the SDR emphasized the need for verifying the invoices produced.

Upon reviewing the submissions and records, the Tribunal noted that the applicant was not a registered dealer for passing credits and the invoices in question did not specify any Customs Duty amounts, negating the possibility of misuse for credit purposes. The Tribunal acknowledged that this situation occurred before a clarifying circular was issued by the Board.

Consequently, the Tribunal found no valid reasons to stay the Commissioner (Appeals)'s order, leading to the rejection of the stay petition. The judgment highlights the importance of fulfilling conditions for availing exemptions and the significance of accurate documentation in claiming refunds or credits related to customs duties.