2022 (12) TMI 228 - AT - Customs

Refund of additional duty of Customs (SAD) paid through DEPB scrip/license - rejection only on the ground that the duty was paid through debit from the relevant DEPB License - HELD THAT - The Notification dated 14/09/2007 as amended by Notification dated 01/08/2008 nowhere denied the refund when the same was paid by debiting DEPB scripts. The said notification laid down certain conditions and the exemption under Notifications has to be upon fulfilment of those conditions only and nothing else. It is not disputed that the appellant have fulfilled the conditions therein and that is why the refund has been sanctioned of that part of the duty which has been paid in cash. Had those the condition were not fulfilled then there was no question of Adjudicating Authority s sanctioning the refund. In a series of decisions it is held that debit of any amount under the DEPB scheme, is a mode of payment of duty of exported goods and it cannot be treated as exempted goods - An identical issue came up for consideration before the Hon ble High Court of Delhi of ALLEN DIESELS INDIA PVT. LTD. VERSUS UNION OF INDIA ORS. 2016 (2) TMI 247 - DELHI HIGH COURT wherein the importers were paying duty of Custom including SAD by using DEPB scrips but the department was not refunding the SAD on the ground that SAD had not been paid in cash but by utilizing DEPB scrips and the Hon ble High Court vide order dated 01/02/2016 allowed the petitions filed by the importers and held that since the petitioner therein have fulfilled the conditions set out in Notification No. 10/2007-CUS for availing the refund, the department is directed to issue orders granting refund to the petitioner therein. Undisputedly, the Revenue has failed to establish through any kind of documents or case laws that debit of any amount under the DEPB scheme is not a mode of payment of duty, therefore the benefit cannot be denied to the appellant. Appeal allowed - decided in favor of appellant.

Summary

Issues:
Whether the appellant is entitled to a refund of additional duty of Customs (SAD) paid through DEPB scrip/license?

Analysis:
The appellant filed refund claims for SAD paid under Customs Tariff Act, 1975 through cash and DEPB License. The Adjudicating Authority sanctioned the refund of cash payments but rejected claims where duty was debited from DEPB License. The Commissioner upheld the rejection. The appellant argued that conditions in the relevant Notifications did not prohibit refunds for duty paid via DEPB scrips. The Revenue contended that a public notice by DGFT restricted refund for duty paid using DEPB scrips after 30/09/2013. The Tribunal noted that the Notifications did not deny refunds for duty paid through DEPB scrips if conditions were met. Citing previous judgments, including one by the Hon'ble High Court of Delhi, the Tribunal emphasized that DEPB scheme debit is a valid mode of duty payment. The Tribunal found no justification to reject the refund claim for duty paid through DEPB scrip, overturning the impugned order and allowing the appeals.

This detailed analysis of the judgment highlights the key arguments presented by the parties, the legal interpretation of relevant Notifications and public notices, and the Tribunal's reliance on previous judgments to support its decision in favor of the appellant.