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2013 (11) TMI 444 - AT - CustomsApplication for stay of order granting refund - Refund of SAD paid - description in the sales invoices for the purpose of VAT was shown as LDPE whereas the product imported was LLDPE - Held that - mistake has happened because of the software which was being used by them and they also take note of the fact that the Chartered Accountant s certificate was submitted which is one of the requirements prescribed by the Board for sanctioning refund. - according to CBEC circular No. 18/2010-Cus. dated 08.07.2010 the authorities have been instructed not to conduct detailed investigation if a Chartered Accountant s certificate has been produced. - in this case not only a Chartered Accountant s certificate was submitted but the sales tax authorities had also given certificate certifying the payment of VAT in respect of goods imported under these bills of entry in the invoices on the basis of refund has been sanctioned. - assessee have been able to show that what has been sold was only LLDPE and not LDPE and therefore I am not able to take a view that Revenue has made out a prima facie case for grant of stay against sanctioning of the refund - Prima facie case not in favour of Revenue - No Stay of refund.
Issues Involved:
Stay application regarding the order setting aside the rejection of the refund claim for SAD paid on LDPE imported under 10 bills of entry. Analysis: The Appellant sought a stay on the order setting aside the rejection of the refund claim for SAD paid on LDPE imported under 10 bills of entry. The original adjudicating authority rejected the claim for 7 bills of entry due to a discrepancy in the product description on sales invoices. The Appellant contended that LDPE and LLDPE are separate products classified under different tariff headings, thus the rejection should stand. However, the Commissioner (Appeals) held that even provisionally assessed bills of entry cannot be rejected. The Respondent argued that the error in description was due to software issues, rectified post-incident, and both LDPE and LLDPE attract the same VAT rate. The Commissioner considered all aspects and concluded that the mismatch in description was unintentional, not for undue benefit, and supported by a Chartered Accountant's certificate and sales tax authorities' certification of VAT payment. The Commissioner's order-in-appeal emphasized compliance with CBEC instructions on invoice production and correlation with bills of entry. The rejection was primarily due to a minor discrepancy in the description, leading to the inference of different goods being sold. The Commissioner noted the limited sources of LDPE/LLDPE in the country and the inevitability of a 4% tax liability on sales, regardless of importation or local production. The conjunction of LDPE/LLDPE in the tax rate schedule justified using LDPE in the description. The mismatch was deemed unintentional and not for tax evasion purposes. The use of software and submission of required certificates supported the Respondent's claim that only LLDPE was sold, justifying the rejection of the stay application. In conclusion, the Tribunal rejected the stay application, finding that the Respondent demonstrated that only LLDPE was sold, not LDPE, and there was no prima facie case for granting a stay against the refund sanction. The unintentional mismatch in description, supported by certificates and compliance with CBEC instructions, did not indicate deliberate intent to claim a refund without tax payment. The software issue and the certificates provided further strengthened the Respondent's position, leading to the rejection of the stay application.
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