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2020 (12) TMI 503 - AT - CustomsApplicability of the time period (limitation) to claim refund of Special Additional Duty (SAD) - N/N. 102/2007-Cus dated 14.09.2007 as amended by N/N. 93/2008-Cus dated 1.8.2008 - refund rejected on the ground the refund claim has not been filed within one year from the date of payment of duty, under Section 27 of the Customs Act, 1962 - HELD THAT - The facts are not in dispute and admittedly, the respondent importer has filed refund claim after more than one year or may be by few days more from the date of payment of SAD. Hon ble Delhi High Court judgement in SONY INDIA PVT. LTD. VERSUS THE COMMISSIONER OF CUSTOMS 2014 (4) TMI 870 - DELHI HIGH COURT has held that In the absence of specific provision of Section 27 being made applicable in the said notification, the time-limit prescribed in this section would not be automatically applicable to refunds under the notification. With the introduction of the circular and then amended notification (No. 93), the Customs authorities started insisting that such limitation period which was prescribed w.e.f. 01.08.2008 by notification became applicable. The findings of the Hon ble high Court clearly show understanding of the department with regard to clause of limitation provided in the Notification. The condition of limitation was not the part of the original notification. It was only with the introduction of Circular No. 6/2008-Cus. and Notification No.93/2008, the department started insisting on the limitation period (of one year) prescribed with effect from 1.8.2008, became applicable. The Hon ble High Court has clearly held that the expression so far as may be used in the sub-section (6) of Section 3 of CTA has to be followed to the extent possible. Merely because Section 27 of the Customs Act provides for a period of limitation for filing refund claim, it cannot be held that even for the purposes of claiming refund in terms of the Notification, the same limitation has to be applied. The Hon ble Delhi High Court has also held that in the maters which deal with substantive rights, such as imposition of penalties and other provisions that adversely affect statutory rights, the parent enactment must clearly impose such obligations; subordinate legislation or rules cannot prevail or be made, in such case. Appeal dismissed - decided against Revenue.
Issues Involved:
Applicability of the time period (limitation) to claim refund of Special Additional Duty (SAD) paid at the time of import of goods in terms of Notification No.102/2007-Cus as amended by Notification No.93/2008-Cus. Issue-wise Detailed Analysis: 1. Facts and Law Applicable: The respondent imported goods under three Bills of Entry dated 20.06.15, 11.08.15, and 13.08.15, paying basic customs duty, additional duty, and SAD. The refund claim for SAD of ?2,34,274/- was filed on 22.08.16. Notification No.102/2007-Customs exempts goods from SAD on subsequent sale, subject to conditions such as payment of all duties at the time of importation, issuance of invoices indicating no credit of SAD, filing a refund claim with the jurisdictional customs officer, and payment of appropriate sales tax or VAT. 2. Amendment by Notification No.93/2008-Cus: Notification No.93/2008 introduced a time limit of one year from the date of payment of SAD for filing a refund claim. The Assistant Commissioner (Refund) rejected the claim on the ground that it was not filed within one year from the date of payment of duty under Section 27 of the Customs Act, 1962. 3. Appeal and Tribunal's Consideration: The respondent's appeal was upheld by the Commissioner (Appeals), referencing the Delhi High Court's decisions in M/s. Sony India Ltd. vs. CC, New Delhi and CC (Import) Vs. Gulati Sales Corporation. The Revenue appealed to the Tribunal, arguing that the time limit for SAD refund has been a contentious issue up to the Supreme Court, with conflicting judgments from different High Courts. 4. Nature of SAD and Exemption Conditions: SAD, levied under Section 3(5) of the Customs Tariff Act, is a duty in the nature of sales tax/VAT, intended to counter-balance sales tax/VAT on like goods sold in India. The exemption under Notification No.102/2007 is conditional upon subsequent sales and payment of sales tax/VAT, with the refund claim to be filed within one year of payment of duty as per Notification No.93/2008. 5. Conflicting High Court Judgments: The Delhi High Court in Sony India Ltd. held that the limitation period cannot start before the right to claim refund accrues, which is upon the sale of goods and payment of sales tax/VAT. Conversely, the Bombay High Court in CMS Infosystems Ltd. opined that the Customs Act's provisions, including the one-year limitation for refunds, apply to SAD. 6. Tribunal's Analysis and Conclusion: The Tribunal noted that the Delhi High Court's findings were not disturbed by the Bombay High Court. The Delhi High Court's interpretation that the right to claim refund accrues upon the sale of goods and the limitation period cannot start before this event was upheld. The Tribunal concluded that the respondent is entitled to the refund as their right to claim refund accrued only when the sale took place, dismissing the Revenue's appeal and upholding the impugned order. Order Pronounced: The appeal of Revenue is dismissed, and the impugned order is upheld.
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