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2023 (8) TMI 267 - AT - CustomsRefund of SAD - Rejection of refund on the ground that the timber logs imported by the appellant was subsequently subject to process like sawing and cutting - HELD THAT - It is an admitted fact that import was made by the appellant by paying the due amount of customs duty and special additional duty. Refund application was submitted only after disposal of considerable part of the goods imported by the appellant with sufficient evidence regarding payment of local tax. The dispute in the present appeal is settled by this Tribunal also in the matter of M/S ARAVIND TRADERS VERSUS COMMISSIONER OF CUSTOMS-COCHIN-CUS 2021 (7) TMI 100 - CESTAT BANGALORE . The appellant is entitled for the refund of Rs. 2,17,556/- rejected by Adjudication Authority on the ground that said amount related to quantity of 111.54 CBM sold after processing. Thus appellant is entitled for the refund of Rs. 2,17,556/- with interest in accordance with law. Appeal allowed in part.
Issues:
The issues involved in this case are the eligibility of the appellant for a refund of 4% additional duty paid at the time of import, based on the subsequent processing of timber logs imported by the appellant. Eligibility for Refund: The appellant, a proprietary concern engaged in the import and supply of timber logs, imported teakwood and paid 4% additional duty amounting to Rs. 3,98,131. After selling a significant portion of the goods, the appellant applied for a refund of the additional duty paid. However, the Adjudication Authority sanctioned a partial refund of Rs. 1,35,012 and rejected the remaining claim of Rs. 2,63,119, citing that the timber logs were subjected to processing like sawing and cutting, making the appellant ineligible for the refund. The Appellate Authority upheld this decision, stating that the goods were no longer in the same form as imported due to processing. The appellant contended that even if the timber underwent processing, no manufacturing occurred, and the classification of the goods remained unchanged. The appellant argued that failure to refund the duty paid would defeat the purpose of introducing the special additional duty to create a level playing field for domestic industries. Reference was made to various judgments, including those of the High Courts and CESTAT, supporting the appellant's position. The Tribunal, after considering the submissions, held that the appellant was entitled to a refund of Rs. 2,17,556, which was previously rejected by the Adjudication Authority, as the goods were sold after processing. The appeal was partially allowed, granting the refund with interest as per the law. Conclusion: In conclusion, the Appellate Tribunal CESTAT Bangalore ruled in favor of the appellant, allowing the refund of Rs. 2,17,556 that was initially rejected by the Adjudication Authority. The Tribunal emphasized that the processing of timber logs did not change the classification of the goods, making the appellant eligible for the refund as per the law and established precedents.
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