2018 (6) TMI 1499 - SC - Customs

Interpretation of Statute - Refund of SAD - Benefit of Notification dated 14-9-2007 - refund of additional duty of Customs paid by the importer of goods u/s 3(5) of the Customs Tariff Act, 1975 - Held that - A mere conversion of imported logs in the Sawn Timber without loss of identity of the original product would not deprive the importer of the benefit of the exemption notification - appeal dismissed - decided against Revenue.

Summary

Issues involved: Interpretation of a notification regarding refund of additional duty of Customs paid by the importer under the Customs Tariff Act, 1975.

Analysis:
1. The main issue in this case revolved around the interpretation of a notification dated 14-9-2007 concerning the refund of additional duty of Customs paid by the importer under Section 3(5) of the Customs Tariff Act, 1975. The notification specified that the import must be for the purpose of subsequent sale, with a condition that the invoice issued for the goods sold must mention that credit of the additional duty of Customs is not admissible. The appellant-Revenue contended that subsequent sale must be in the same form as the goods were received on import. However, the Court disagreed with this view, stating that the exemption notification did not support such a strict interpretation. The Court noted that the logs imported had to be reduced in size for transit due to state-imposed conditions, which did not alter the identity of the original product. Therefore, the Court held that converting imported logs into Sawn Timber without loss of identity did not disqualify the importer from the exemption notification.

2. The Court dismissed the appeals of the Revenue, upholding the decisions of the Customs, Excise and Service Tax Appellate Tribunal and the High Court. The Court affirmed that the mere conversion of imported logs into Sawn Timber did not negate the importer's eligibility for the exemption notification. Consequently, the orders of the Tribunal and the High Court were upheld, and the appeals of the Revenue were rejected.

3. Additionally, the Court ordered the return of bank guarantees deposited by the respondent(s) along with any accrued interest. The Court granted leave in certain other civil appeals and condoned delays in specific cases. The dismissal of the present appeals was based on the decision in Civil Appeal Nos. 10258-10296 of 2011, with the same terms applied to the current appeals regarding the refund of additional duty of Customs. The Court reiterated the directive to return bank guarantees to the respondent(s) with any applicable interest.