2017 (5) TMI 1069 - AT - Customs

Refund of SAD - denial on the ground that there is no co-relation of the goods imported and the goods sold in the case in hand - whether the importer/respondent is eligible for the refund of SAD paid by them at the time of importation of the goods TTR in jumbo rolls and sale of the same after slitting and cutting in the local market on payment of applicable VAT or otherwise? - Held that - the records produced establish that importer/respondent has produced the domestic sales invoices of the details of the relating to bills of entry under which the goods have been imported and SAD have been paid - appeal rejected - decided against appellant.

Summary

Issues:
Refund of Special Additional Duty of Customs (SAD) paid on imported Thermal Transfer Ribbons (TTR) - Co-relation of goods imported and sold - Eligibility for refund under Notification No. 102/2017-Cus.

Analysis:
The appeals were filed by the Revenue against the rejection of refund claims for SAD paid on TTR imported by the respondent. The adjudicating authority rejected the refund claims citing lack of co-relation between the imported goods and goods sold. The first appellate authority overturned this decision after considering all relevant documents provided by the importer. The Revenue argued that the conditions for availing benefits under Notification No. 102/2017-Cus were not fulfilled due to a change in the form of goods from jumbo rolls to smaller rolls. However, the importer contended that all necessary documents were submitted, and the first appellate authority had correctly sanctioned the refund.

The main issue was whether the importer was eligible for the refund of SAD paid at the time of importing TTR in jumbo rolls and subsequently selling them in the local market after cutting and slitting. The first appellate authority had acknowledged the documents provided by the importer, including a Chartered Engineer's certificate and domestic sales invoices, to establish the co-relation between the imported goods and those sold after VAT payment. The Tribunal referred to a previous case involving HR/CR imports and held that if goods sold after processing were subject to local VAT, the refund of paid SAD could not be denied. This decision was supported by the Hon'ble High Court of Gujarat, leading to the rejection of the Revenue's appeal and the affirmation of the first appellate authority's decision to grant the refund.

In conclusion, the Tribunal found no merit in the appeals filed by the Revenue and rejected them. The cross objections filed by the respondent assessee were also disposed of accordingly. The judgment emphasized the importance of establishing a clear co-relation between imported goods and those sold after processing to determine eligibility for SAD refund, as evidenced by the documents submitted by the importer in this case.