2014 (5) TMI 561 - AT - Customs

Denial of refund claim - notification no. 102/07-Cus dated 14.09.2007 - Held that - Adjudicating Authority has granted refund relating to the SAD duty. There is a condition in Notification No. 102/207-Cus dated 14.9.2007, that if the importer had passed on the duty to the buyer and stipulation is made in the invoice in the form of stamp No credit of Additional duty levied under Sub-section (5) of Section 3 of Customs Tariff Act, 1975 shall be available - it was evident from the invoices referred above that necessary condition prescribed in the notification has not been fulfilled by the importer. Therefore, grant of refund to the respondent is not proper and is liable to be rejected - Decided in favour of Revenue.

Summary

Issues: Grant of refund under Notification No. 102/07-Cus dated 14.09.2007

Issue 1: Grant of refund by Adjudicating Authority and Commissioner (Appeals)
The Revenue appealed against the Order-in-Appeal No. 11/CUS/APPL/JAL/2009, which granted a refund to the respondent and upheld by the Adjudicating Authority. The Revenue contested the grant of refund by both the Adjudicating Authority and the Commissioner (Appeals).

Analysis: The respondents filed a refund claim based on Notification No. 102/07-Cus dated 14.09.2007 for the refund of 4% of additional duty of Customs paid on the import of Caraway seeds. The Adjudicating Authority allowed the refund, stating that the respondents had met the requirements of the notification and a circular by the Board. However, the Revenue argued that the condition specified in the notification regarding mentioning in the sale invoices that no credit of the additional duty shall be admissible was not fulfilled by the respondent. The invoices presented by the respondent did not comply with this condition, as they contained a statement allowing the credit of the additional duty, contrary to the notification's requirement.

Issue 2: Compliance with Notification No. 102/07-Cus dated 14.09.2007
The main contention revolved around whether the respondent fulfilled the conditions specified in Notification No. 102/07-Cus dated 14.09.2007, particularly regarding the specific indication in the sale invoices that no credit of the additional duty of customs shall be admissible.

Analysis: The Notification required the respondent to mention in the sale invoices that no credit of the additional duty shall be admissible. The Revenue argued that the invoices provided by the respondent did not meet this requirement, as they contained a statement allowing the credit of the additional duty, which was contrary to the prescribed condition. The Tribunal found merit in the Revenue's argument, stating that the necessary condition specified in the notification was not fulfilled by the importer, leading to the rejection of the refund claim. Consequently, the Commissioner (Appeals) order granting the refund was deemed improper and was rejected by the Tribunal.

In conclusion, the appeal filed by the Revenue was allowed, emphasizing the importance of strict compliance with the conditions specified in notifications for claiming refunds under customs laws.