2014 (2) TMI 830 - AT - Customs

Denial of refund claim - Whether it is mandatory to claim exemption notification under Customs - exemption from SAD under Notification 201/10-cus. dt. 27.10.2010 - Claiming Refund claim of SAD Notification No.102/07-Cus. dt. 14.9.07 - Held that - two grounds taken are that once any goods are exempt from any type of customs duty, importer has no option to pay such customs duty thereon - in the absence of any specific prohibition under section 25 of the Customs Act to the effect that importer cannot pay import duty when goods are exempted,an importer cannot be forced to avail such exemption in view of the various decisions of the courts. It was also observed in the said order that after such decisions were given by the courts an amendment was made in section 5A of the Central Excise Act by introducing sub-section (1A) but no such provision has been introduced in section 25 of the Customs Act which implies that decisions given by the court on this issue continues to be in force in the matter of exemptions issued under section 25 of the Customs Act, 1962. Ruling given in the order dt. 23.9.2013 is that in the case of goods, for which there is no exemption from SAD, when refund is being granted under notification No.102/07 dt. 14-09-07 after payment of VAT on sale of the goods and on submission of documents prescribed under the said notification, it is not taken as a case of reassessment. Such objections are not raised while administering benefit of notification 102/07-Cus for normal goods imported on which SAD is paid. Therefore is no reason to take such objection in the case of goods which were exempted from SAD under Notification 201/10-cus. dt. 27.10.2010 (Sl.No.1) but on which the respondent paid duty without availing exemption. We find no reason to change our earlier decision - Decided against Revenue.

Summary

Issues involved:
Refund claim for Special Customs Duty [SAD] under notification No.102/07-Cus. dt. 14.9.07; Denial of refund claims for goods exempted from payment of SAD under notification 201/10-cus. dt. 27.10.2010; Reassessment of Bill of Entry without challenging the original assessment order.

Analysis:

1. The appeals involved ten cases filed by Revenue against the same respondent regarding refund claims for Special Customs Duty [SAD] under notification No.102/07-Cus. The issue in dispute was previously decided in two Tribunal orders, leading to the consideration of all appeals together. The respondent sought refund under the provisions of the notification, claiming that the goods were sold on payment of VAT after importation. The adjudicating authority denied the refund for goods exempted from SAD under notification 201/10-cus., stating that the respondent could not have paid the duty and then claimed a refund. The Commissioner of Customs (Appeals) allowed the refund, leading to the filing of appeals by Revenue.

2. The main grounds of appeal were that once goods are exempt from customs duty, the importer cannot pay the duty, and granting a refund involves reassessment without challenging the original assessment. The Tribunal's decision on 23.9.2013 clarified that in the absence of a specific prohibition, an importer cannot be forced to avail of exemptions. The Tribunal observed that decisions by courts continue to be in force in matters of exemptions under the Customs Act, 1962. Regarding the second issue, the Tribunal ruled that granting a refund for goods exempted from SAD under notification 201/10-cus. does not constitute reassessment, as the refund is based on payment of VAT and submission of required documents under notification No.102/07.

3. The Tribunal rejected the appeals filed by Revenue, upholding its earlier decision. It emphasized that there is no reason to change the ruling, as objections raised were not applicable in cases where goods exempt from SAD were involved. The Tribunal also disposed of stay petitions and cross-objections filed by the respondent, concluding the proceedings on 04-02-2014.