2016 (12) TMI 522 - HC - Customs

Refund of SAD - Section 27 of the Customs Act - condition no. 16 of Notification No. 12/2012-Ex. dated 17.03.2012 - rejection of refund due to availment of CENVAT credit - Held that - reliance placed on the decision of the case of M/s SRF Ltd., M/s ITC Ltd Versus Commissioner of Customs, Chennai, Commissioner of Customs (Import And General), New Delhi 2015 (4) TMI 561 - SUPREME COURT , where it was held that the CEGAT has come to the conclusion that when the credit under the CENVAT Rules is not admissible to the appellant, question of fulfilling the aforesaid condition does not arise. In holding so, it followed the judgment of the Bombay High Court in the case of Ashok Traders v. Union of India 1987 (10) TMI 53 - HIGH COURT OF JUDICATURE AT BOMBAY , wherein the Bombay High Court had held that it is impossible to imagine a case where in respect of raw nephtha used in HDPE in the foreign country, Central Excise duty leviable under the Indian Law can be levied or paid. Thus, the petitioner s claim has to succeed. A direction is issued to the respondents to process the refund application and pass appropriate orders having regard to the materials placed provided it is filed within two weeks - petition allowed - decided in favor of petitioner-assessee.

Summary

Issues involved:
1. Direction sought for processing refund application under Section 27 of the Customs Act.
2. Claim for refund of excess customs duty paid on import under Section 3(1) of the Customs Tariff Act.
3. Interpretation of eligibility for refund based on CENVAT credit entitlement.
4. Comparison with previous rulings including SRF Ltd. v. Commissioner of Customs, Chennai and Micromax Informatics Ltd. v. UOI.
5. Application of principles from Thermax Private Limited v. Collector of Customs and Hyderabad Industries Ltd. v. Union of India in determining additional duty on imported articles.

Analysis:
1. The petitioner requested a direction for processing its refund application under Section 27 of the Customs Act, claiming a refund of additional customs duty paid on imports under Section 3(1) of the Customs Tariff Act. The petitioner imported mobile handsets and alleged excess payments made under protest, complying with Notification No. 12/2012-Ex. The impugned order by the Commissioner of Customs (Appeals) denied the refund, citing the petitioner's failure to establish entitlement to CENVAT credit, rendering them ineligible for the refund.

2. The court noted the petitioner's reliance on the Supreme Court ruling in SRF Ltd. v. Commissioner of Customs, Chennai and a previous order of the court in Micromax Informatics Ltd. v. UOI. The judgment in Micromax Informatics Ltd. highlighted the principles from Thermax Private Limited v. Collector of Customs and Hyderabad Industries Ltd. v. Union of India, emphasizing the interpretation of Section 3(1) of the Tariff Act concerning the levy of additional duty on imported articles.

3. The court concluded that the petitioner's claim aligned with the legal principles established in previous judgments, notably SRF Ltd. v. Commissioner of Customs, Chennai. Consequently, the court directed the respondents to process the refund application within two weeks, considering the materials presented by the petitioner. The writ petition was allowed, with no costs imposed.

In summary, the judgment addressed the petitioner's refund claim for excess customs duty paid on imports, analyzing their eligibility based on CENVAT credit entitlement and relevant legal precedents. The court's decision was influenced by past rulings, emphasizing the application of legal principles in determining additional duty on imported articles.