2023 (11) TMI 382 - AT - Customs

Refund of SAD - time limitation - relevant time - rejection on the ground of limitation i.e beyond 1 year from the date of payment of customs duty - whether the 1 year limitation should apply for granting the refund of 4 % SAD from the date of payment of customs duty or from the date of sale of goods and payment of VAT? HELD THAT - In order to grant the refund of 4 % SAD an assessee is required to submit the sales invoices and proof of payment of VAT/ Sales Tax. In this position, if the goods is not sold then the assessee cannot filed a refund claim, and even, if it is filed as a precautionary measure the department will not entertain such refund claim, for the reason that there will be neither sale invoice nor payment of VAT. Considering this position the Delhi High Court in the case of SONY INDIA PVT. LTD. VERSUS THE COMMISSIONER OF CUSTOMS 2014 (4) TMI 870 - DELHI HIGH COURT , held that the period of limitation of 1 year from the date of payment of duty shall not apply, whereas 1 year shall apply from the date of sale of the goods. The appellant s refund claim is not time barred as the same was filed while within 1 year from the date of sale of the goods. The impugned order set aside - appeal allowed.

Summary

Issues Involved:
The issue involved in the present case is whether the rejection of refund claim in respect of 4% SAD on the ground of limitation i.e beyond 1 year from the date of payment of customs duty is legally incorrect or otherwise.

Judgment Details:

Issue 1: Time Limit for Refund Claim
The appellant argued that the refund claim was filed within 1 year from the date of sale of the goods, not the payment of duty, as the refund arises only upon sale. They cited various cases where courts held that the limitation period should start from the date of sale, not payment of duty. The Tribunal noted that to grant the refund, sales invoices and proof of VAT payment are required. If goods are unsold, a refund claim cannot be filed. The Delhi High Court in the case of Sony India held that the limitation period should start from the date of sale, a decision upheld by the Supreme Court. The Tribunal also mentioned judgments where the Supreme Court affirmed the Delhi High Court's view. Despite a contrary view by the Bombay High Court, the Tribunal held in favor of the Delhi High Court's position.

Decision:
Considering the legal position, the Tribunal held that the appellant's refund claim was not time-barred as it was filed within 1 year from the date of sale of the goods. The impugned order was set aside, and the appeal was allowed.

(Separate Judgment by Judge Ramesh Nair)
*(No separate judgment was delivered by Judge Ramesh Nair in this case.)*