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2021 (2) TMI 401 - HC - CustomsRefund of the Additional Duty of Customs (SAD) - N/N. 102/2007, dated 14-9-2007 - sale of the imported elevator in India - rejection of refund on the ground that the description of the imported goods and the goods sold in India does not tally - HELD THAT - Notification No. 102/2007, dated 14-9-2007 (as amended), provides for refund of Additional Duty of Customs paid under Section 3(5) of the Customs Tariff Act, 1975 upon sale of imported goods in India, subject to certain conditions. Among the conditions prescribed, the importer was required to pay the appropriate Sales Tax or Value Added Tax and should also produce documents evidencing payment of appropriate Sales Tax or Value Added Tax, as the case may be, on sale of such imported goods - By Circular No. 6/2008, dated 28-4-2008, the Central Board of Excise and Customs had prescribed the procedures to be adopted for refund of the 4% Additional Duty of Customs, in pursuance of Notification No. 102/2007, dated 14-9-2007. As per Clause 5.1 of this Circular, the importer was required to furnish a certificate from the Statutory Auditor, certifying that the imported goods and the local goods are one and the same. The only reason adduced by the respondent in rejecting the petitioner s claim for refund is that, the goods that were locally sold are not the goods that were imported. For such a reasoning, the respondent had relied upon the description in the Bill of Entry of the imported goods, which reads as, Elevator in SKD condition , whereas, the description mentioned in the Sale Invoice dated 31-10-2012 reads as 1 No. Johnson 6 Passenger (408 kgs) Electric Mini Sukranti Lift . Since the respondent was of the view that these two descriptions are distinct, they had concluded that the goods sold are not the same as that imported under the Bill of Entry. The procedure contemplated for seeking exemption/refund of the Additional Duty of Customs is under Notification No. 102/2007, dated 14-9-2007 read with Circular No. 6/2008, dated 28-4-2008. If that be so, the respondent is mandated to strictly adhere to the procedure prescribed under this notification/circular and cannot deviate from the same. However, in the instant case, the respondent seems to have applied their own logic and imagination to differentiate the imported goods with the goods sold locally inside India. If at all, the respondent was of the view that the descriptions in the imported goods and locally sold goods are different, the only yardstick that requires to be applied is the conditions prescribed in Notification No. 102/2007, dated 14-9-2007 and Circular No. 6/2008, dated 28-4-2008. In other words, Circular No. 6/2008, which clarifies the conditions prescribed in Notification No. 102/2007, dated 14-9-2007, requires the importer to produce the certificate of the Statutory Auditor along with the correlation statement and if such certificate and correlation statement are produced, the respondent is bound to accept the description of the goods in the import documents as well as the Sales Invoice to be one and the same, on the strength of the certificate/correlation statement - Though the condition prescribed under the notification does not prescribe a different procedure and even assuming that the respondent was not satisfied with the certificate issued by the Statutory Auditor, such a decision should be based on certain incriminating and reliable documents before him and further, the reasons for disbelieving the certificate requires to be spelt out. Such a proposition has been laid down by a Hon ble Division Bench of this Court in P.P. Products Ltd. 2019 (5) TMI 830 - MADRAS HIGH COURT . This Court is of the view that though there is an alternate remedy of appeal as against the impugned order in the present case, the same shall not be a bar to maintain this writ petition under Article 226 of the Constitution of India, since there is a violation of the procedure prescribed under the statute and thereby, the order itself is wholly without jurisdiction. The respondent shall refund the claim made by the petitioner, which is the subject matter of the Order-in-Original, together with interest at the rate of 6% p.a. from the date of the refund application - Petition allowed.
Issues Involved:
1. Rejection of refund claim for Additional Duty of Customs. 2. Adherence to procedural regulations and conditions under Notification No. 102/2007 and Circular No. 6/2008. 3. Maintainability of the writ petition despite the availability of an alternate remedy. 4. Violation of Principles of Natural Justice. Detailed Analysis: 1. Rejection of Refund Claim for Additional Duty of Customs: The petitioner imported an "Elevator in SKD condition" and paid Additional Duty of Customs amounting to ?39,899.70. Upon selling the elevator in India, the petitioner sought a refund under Notification No. 102/2007, which was rejected on the grounds that the description of the imported goods did not match the goods sold in India. The respondent argued that the discrepancy between the descriptions in the Bill of Entry and the Sale Invoice violated the notification's conditions. 2. Adherence to Procedural Regulations and Conditions under Notification No. 102/2007 and Circular No. 6/2008: The petitioner complied with the procedure for refund claims as outlined in Circular No. 6/2008, which mandates the submission of a certificate from the Statutory Auditor and a Correlation Certificate. The petitioner provided these documents, certifying that the imported goods were the same as those sold locally. The court emphasized that the respondent must strictly adhere to the procedures and cannot deviate from them. The respondent's differentiation between "elevator" and "lift" was deemed unsubstantial, and the court noted that the Statutory Auditor's certificate should be relied upon unless there are incriminating and reliable documents to the contrary. 3. Maintainability of the Writ Petition Despite the Availability of an Alternate Remedy: The respondent argued that the writ petition should be dismissed as the petitioner did not exhaust the alternate remedy of an appeal. However, the court noted that the decision in M/s. King Overseas v. Assistant Commissioner of Customs was set aside in appeal, allowing the writ petition to proceed. The court held that the writ petition is maintainable under Article 226 of the Constitution of India due to the procedural violations and lack of jurisdiction by the authority. 4. Violation of Principles of Natural Justice: The impugned order was issued without a show cause notice, violating the Principles of Natural Justice. The court held that this procedural lapse justified the invocation of writ jurisdiction without requiring the petitioner to exhaust alternate remedies. Conclusion: The court quashed the impugned Order-in-Original No. 37233/2015, dated 30-4-2015, and directed the respondent to refund the claimed amount with interest at the rate of 6% p.a. from the date of the refund application. The refund should be disbursed within four weeks from the receipt of the court's order. The writ petition was allowed, and no costs were imposed.
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