2016 (2) TMI 206 - AT - Customs

Refund of Special Additional Duty (SAD) - Notification No. 102/07-CUS - mis-match between the description of goods indicated in the Bills of Entry and the sales invoices issued by the appellant. - as per the trade practice and for the purposes of easy identification of the said goods for selling to the local traders, the description of the goods was mentioned in the short form as fabric cloth Held that - the appellant had mentioned therein the reference of the Bills of Entry evidencing importation of the disputed goods on payment of SAD amount; that the said invoices also bore the declaration that no credit of the Additional Duty of Customs (SAD) levied under the Customs Tariff Act shall be available to the buyer of goods; that Central Sales Tax/ value added tax payable on sale of the disputed goods have been clearly mentioned in the said invoices. Thus, it is evident from the retail invoices that the goods imported on payment of SAD amount have been sold in the domestic market by the appellant. - Refund allowed.

Summary

Issues:
Refund of Special Additional Duty (SAD) denied due to mismatch in goods description between Bills of Entry and sales invoices.

Analysis:
The appeals were filed against the denial of a refund of Special Additional Duty (SAD) by the Commissioner of Customs (Appeals) based on a mismatch in the description of imported goods between the Bills of Entry and sales invoices. The appellant claimed that all conditions for the refund, as per Notification No. 102/07-CUS, had been met, and necessary documents were submitted to the refund sanctioning authority, showing compliance with the Circulars issued by CBEC. The appellant argued that despite a slight discrepancy in the goods' description, the goods imported were indeed sold in the domestic market, supported by the payment of VAT/sales tax. The appellant cited a previous Tribunal decision to support their claim that a minor difference in description should not lead to refund denial.

The Revenue, represented by the ld. DR, maintained that the burden of proof lay with the appellant to demonstrate the satisfactory discharge of the SAD amount. Upon review, the Tribunal found that while the Commissioner (Appeals) acknowledged the appellant's compliance with the notification conditions, the refund was rejected solely due to the discrepancy in goods description. The Tribunal noted that the complete description for customs valuation purposes differed from the shorter, trade-oriented description used for local sales. The retail invoices referenced the Bills of Entry, confirmed payment of SAD, disallowed credit for Additional Duty of Customs, and clearly stated the applicable taxes, indicating the goods were sold domestically.

The Tribunal concluded that since the appellant had met all conditions for the refund as per the notification and circulars, a mere change in goods description on domestic invoices, possibly due to trade practices, should not justify denying the entitled refund. Citing the precedent set in a similar case, the Tribunal ruled in favor of the appellant, overturning the Commissioner (Appeals)'s decision and allowing the appeal.