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2017 (3) TMI 216 - HC - CustomsRefund of SAD - N/N. 102/2007Cus dated 14.09.2007 - denial on the ground that the assessee has not paid the VAT on the imported goods i.e. coils and what is sold subsequently by the assessee and on which VAT is paid is altogether different goods i.e. roof - Held that - for claiming refund under the said Notification the importer has to satisfy that the Value Added Tax / Sales Tax as the case may be has been paid on the goods imported and only those goods imported are sold and the VAT is paid on such imported goods - In the present case what is imported by the appellant is coil sheets. The Special Additional Duty is paid on such imported goods namely coil sheets. Thereafter what is manufactured and sold by the appellant is Proflex Roof and on such Proflex Roof VAT is paid. Therefore it cannot be said the assessee has paid the VAT on the goods imported on which Special Additional Duty has been paid. Even in the invoice the rate of laying of Proflex Roof is also charged on per square meter including the value of the material. There is no separate invoice / bill issued for coil sheets. Therefore it cannot be said that what is sold by the appellant to his client is same goods which is imported i.e. coil sheets. Under the circumstances and one of the condition of N/N. 102/2007Cus dated 14.09.2007 has not been complied with - appeal dismissed - decided against appellant.
Issues Involved:
1. Refund of Special Additional Duty (SAD) under Notification No. 102/2007-Cus dated 14.09.2007. 2. Whether the steel sheets in coils became a different product after corrugation. 3. Whether the VAT paid on the final product satisfies the conditions for SAD refund. Detailed Analysis: 1. Refund of Special Additional Duty (SAD) under Notification No. 102/2007-Cus dated 14.09.2007: The appellant claimed a refund of SAD paid on imported steel sheets in coils under Notification No. 102/2007-Cus dated 14.09.2007. The notification provides for a refund of SAD if the imported goods are sold and VAT is paid on them. However, the adjudicating authority, Commissioner of Customs (Appeals), and the CESTAT denied the refund, stating that the VAT was not paid on the imported coils but on a different product, i.e., Proflex Roof, which is manufactured from the coils. The court upheld this view, emphasizing that one of the conditions of the notification was not satisfied as the VAT was not paid on the imported goods (coil sheets). 2. Whether the steel sheets in coils became a different product after corrugation: The appellant argued that the imported coils were merely corrugated and then installed as Proflex Roof, and thus the product did not change. The court, however, found that the process of corrugation and subsequent installation transformed the coils into a different product, i.e., Proflex Roof. The court noted that the invoice issued by the appellant charged for the Proflex Roof on a per square meter basis, including the value of the material, indicating that what was sold was not the same as the imported coils. 3. Whether the VAT paid on the final product satisfies the conditions for SAD refund: The appellant contended that the VAT paid on the Proflex Roof should be considered as VAT paid on the imported coils since the coils were used to manufacture the roof. The court rejected this argument, stating that the VAT was paid on a different product (Proflex Roof) and not on the imported coils. The court emphasized that for the refund of SAD under the notification, the VAT must be paid on the same goods that were imported. Since this condition was not met, the appellant was not entitled to the refund. Conclusion: The court dismissed the appeal, agreeing with the lower authorities that the appellant did not satisfy the conditions of Notification No. 102/2007-Cus dated 14.09.2007. The VAT was paid on a different product (Proflex Roof) and not on the imported coils, and thus the appellant was not entitled to the refund of SAD. The court found no substantial question of law and upheld the decision of the CESTAT.
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