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2019 (3) TMI 125 - AT - CustomsRefund of SAD - N/N. 102/2007-Cus. read with Board Circular No. 16/2008 and Section 27(1) of Customs Act, 1962 - refund rejected on the ground of time limitation - Held that - A cursory reading of the N/N. 102/2007-Cus. and N/N. 93/2008-Cus. would clearly reveal that in the public interest, such notifications were made by the Government of India and SAD was made applicable to counter balance CST/VAT and create a level playing field for domestic goods so that price different from the locally manufacture goods and imported goods would not put the local manufacturer in a disadvantageous position - Admittedly CST, VAT are collected for distribution among the states, for which it is difficult to understand why SAD is introduced as a counter balance. It appears that only to maintain the price equilibrium, SAD has been introduced as a precautionary major to provide coverage to indigenous goods. Therefore, it is collected with the above purpose of providing a security to such indigenous goods and collected as a security from the importer so that the movement they sale it up in the domestic market, they will pay CST/VAT accordingly and get back the SAD already paid, by way of refund. Amended sub-para (c) of para 2 which stipulated the time period to filed claim of refund as one year from the date of payment of said additional duty of Customs should be read as effective payment of additional duty of Customs by way of CST/VAT as the purpose of payment of SAD at the time of import was in the nature of counter balancing the CST/VAT etc. which could be treated as par with security - Such stipulation of time frame is meant for payment of CST/VAT which was realised against counter balance by way of payment of SAD, the same period of one year is to be computed from the date of payment of CST, VAT etc., upon sale of goods. It is a settled principle that Tribunal being creature of statute, cann t go beyond the provisions of law but there is no impediment on the part of the Tribunal to read into the law to provide meaning and Charity to the provisions of law for the purpose of making it virtually implementable. The appellant refund claim is to be reassessed on the basis of date of payment of CST/VAT etc. that was earlier deposited by way of SAD that has been exempted vide Notification No. 102/2007-Cus. and 93/2008-Cus. and allowed if claim is made within one year of payment of CST/VAT - Appeal allowed in part.
Issues Involved:
1. Refusal of refund claim of ?36,12,768/- under Notification No. 102/2007-Cus. 2. Time limitation for filing refund claims under Notification No. 93/2008-Cus. 3. Jurisdictional conflict between the judgments of the Delhi High Court and Bombay High Court. 4. Interpretation of the term "exemption" in the context of Special Additional Duty (SAD). Issue-wise Detailed Analysis: 1. Refusal of Refund Claim of ?36,12,768/- Under Notification No. 102/2007-Cus: The appellant filed a refund claim for ?36,12,768/- in respect of nine Bills of Entries on 10.09.2015 as per Notification No. 102/2007-Cus. The Assistant/Deputy Commissioner of Customs, CRC-SAD-II, JNCH, rejected the claim on the grounds that it was filed after the expiry of one year, as stipulated by Notification No. 93/2008-Cus. The appellant did not contest this initially, leading to the rejection of the refund claim as time-barred. The appellant successfully challenged this decision before the Commissioner (Appeals) and ultimately approached the Tribunal. 2. Time Limitation for Filing Refund Claims Under Notification No. 93/2008-Cus: The crux of the dispute revolves around the time limitation for filing refund claims. The appellant argued, relying on the Delhi High Court judgment in M/s Sony India Ltd., that no time period was prescribed for claiming refunds of SAD. Conversely, the respondent-department cited the Bombay High Court judgment in CMC Info Systems Ltd., which upheld the one-year limitation period. The Tribunal had to consider these conflicting judgments and the principle of judicial discipline. 3. Jurisdictional Conflict Between the Judgments of the Delhi High Court and Bombay High Court: The appellant contended that the Tribunal should follow the Delhi High Court's judgment, as it had attained finality with the dismissal of the SLP by the Supreme Court. However, the respondent argued that the Bombay High Court's judgment should prevail, as the Tribunal is subject to its jurisdiction. The Tribunal acknowledged the principle of stare decisis and the binding nature of jurisdictional High Court decisions but also recognized the need to consider conflicting High Court judgments to determine which applied more aptly to the facts of the case. 4. Interpretation of the Term "Exemption" in the Context of Special Additional Duty (SAD): The Tribunal examined the background of SAD's introduction and its purpose, which was to create a level playing field for domestic goods by counterbalancing CST/VAT. The Tribunal noted that the exemption from SAD was intended to prevent double taxation for traders who paid CST/VAT on imported goods. The Tribunal emphasized that the refund mechanism was designed as an exemption clause, not as a rebate or refund of excess payment. The Tribunal interpreted the amended sub-para (c) of para 2 of Notification No. 93/2008-Cus. to mean that the one-year period for filing refund claims should be computed from the date of payment of CST/VAT, not from the date of payment of SAD. Conclusion: The Tribunal allowed the appeal in part, setting aside the order passed by the Commissioner of Customs (Appeals). The appellant's refund claim is to be reassessed based on the date of payment of CST/VAT and allowed if the claim is made within one year of such payment. The Tribunal's decision harmonized the conflicting judgments by interpreting the time limitation in a manner consistent with the purpose of SAD and the principles of equity and justice.
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