2024 (3) TMI 1110 - AT - Customs

Seeking to recover the refund already sanctioned - imported timber log and paid SAD - Sold timber after cutting and sawing - non-endorsement of the declaration - violations of Notification 102/2007-Cus - non-mention of Bills of Entry number on the invoice and mismatch of description - HELD THAT - We find that the primary objection raised in the instant case is that the appellant have sold timber after cutting and sawing. This issue is specifically covered by the decision of Hon ble Apex Court in the case of V ariety Lumbers 2018 (6) TMI 1499 - SUPREME COURT it has been held that the refund cannot be denied even if the imported logs were cut and sawn before sale. Non-endorsement of the declaration in terms of para 2(b) of Notification 102/2007-Cus. The said para 2(b) requires the importer to mention on the invoices that no credit of additional duty of customs levied under sub section (5) of Section 3 of the Customs Tariff Act 1975 shall be admissible. We find that since the appellant is not a registered dealer therefore the question of taking credit on the invoices issued by them does not arise. Non-mention of Bills of Entry number on the invoice and mismatch of description and number of pieces on the invoices and bills of entry. In grounds of appeal it has been clearly indicated that stock requests duty certified by Chartered Accountant was produced at the time of filing refund. Following the case Overseas Polymers 2021 (1) TMI 1212 - CESTAT CHENNAI . It is clear that minor discrepancies cannot be the reason for recovery of refund when the appellant had submitted Chartered Accountant certified stock report. Thus we do not filed any merit in the order the same is set aside and appeals are allowed. The appeal of the Naresh Aggarwal Director is also consequently allowed.

Summary

Issues involved: Recovery of refund, imposition of penalty, mismatch of description, procedural violations, limitation, non-endorsement of declaration, mismatch of Bills of Entry number.

The appeal was filed against the order seeking to recover the refund already sanctioned to the appellant and against the imposition of penalty on the Director of the appellant company. The primary issue was the mismatch between the item imported (timber logs) and the item sold (saw logs) by the appellant, leading to a demand for recovery of the refund. Another issue raised was the procedural violations and mismatch of description as per Notification 102/2007-Cus. The appellant argued that the refund cannot be denied even if the imported logs were cut and sawn before sale, citing legal precedents such as the Variety Lumbers case. The issue of limitation was also raised, pointing out that the demand for recovery was barred by limitation.

Regarding the mismatch of description and procedural violations, the appellant argued that small discrepancies in the description of goods should not disentitle them from the refund, supported by various legal decisions. The issue of non-endorsement of the declaration as per Notification 102/2007-Cus was raised, with the appellant contending that as they were not registered dealers, the question of taking credit on the invoices did not arise. The issue of mismatch of Bills of Entry number and description on the invoices was also addressed, with the appellant providing a Chartered Accountant certified stock report to support their claim.

The Tribunal considered the arguments presented and referred to legal precedents, including the Variety Lumbers case, to conclude that the appellant was entitled to the refund. They rejected the grounds raised by the Revenue, including the argument that refund is not admissible if the imported logs are sold as cut and sawn wood. The Tribunal also dismissed the objections related to non-endorsement of the declaration and mismatch of Bills of Entry number, emphasizing that minor discrepancies should not be the basis for the recovery of the refund when supported by a Chartered Accountant certified stock report. Ultimately, the Tribunal set aside the order and allowed the appeals, including that of the Director.