2023 (12) TMI 1252 - AT - Customs

Refund of SAD - SAD had been paid, not in cash, but by utilising the DEPB scrip - HELD THAT - The said issue came up before the Hon ble Delhi High Court in the case of ALLEN DIESELS INDIA PVT. LTD. VERSUS UNION OF INDIA ORS. 2016 (2) TMI 247 - DELHI HIGH COURT , wherein it was held that Although it is sought to be projected that the circulars which are subject matter of the challenge in the present petitions were issued to streamline the procedure and to remove ambiguities, in fact what the circulars seek to amend is Notification No. 102/2007-Customs itself by introducing an additional condition for being entitled to refund, which condition does not find place in Notification No. 102/2007-Customs. As the issue is no more res-integra in view of the judicial pronouncement of the Hon ble High Court and the Tribunal and the ld. Commissioner (Appeals) has followed the same - there are no infirmity in the impugned order and the same is upheld. The appeal filed by the Revenue is dismissed.

Summary

Issues Involved:

1. Refund of Special Additional Duty (SAD) paid using DEPB scrips.
2. Validity of circulars imposing additional conditions for refund.
3. Fulfillment of conditions under Notification No. 102/2007-Customs.

Summary:

Refund of Special Additional Duty (SAD) Paid Using DEPB Scrips:

The respondent imported Sulphuric Acid Brown and paid Customs duty, including SAD, using DEPB scrips and cash. They filed for a refund of SAD, which was partially sanctioned for the amount paid in cash but rejected for the amount paid using DEPB scrips. The Commissioner (Appeals) allowed the refund for the DEPB scrips portion, leading to the Revenue's appeal.

Validity of Circulars Imposing Additional Conditions for Refund:

The Hon'ble Delhi High Court in Allen Diesels India Private Limited Vs. Union of India (2016) ruled that circulars issued by C.B.E. & C. (Nos. 6/2008, 10/2012, and 18/2013) imposing additional restrictions for refund of SAD paid using DEPB scrips were ultra vires. The court emphasized that any amendment to a notification under Section 25(1) of the Act must be through another notification and not via circulars. The rejection of refund applications based on these circulars was deemed invalid.

Fulfillment of Conditions Under Notification No. 102/2007-Customs:

The Tribunal, in Virgo Suitings Private Limited (2022), reiterated that the Notification dated 14/09/2007, as amended, did not deny refunds for duties paid using DEPB scrips. The Tribunal noted that the appellant fulfilled the conditions of the notification, and thus, the refund should not be denied. This position was supported by multiple judicial pronouncements, including those of the Hon'ble High Court, establishing that payment through DEPB scrips is a valid mode of duty payment.

Conclusion:

The Tribunal found that the issue is no longer res-integra and upheld the Commissioner (Appeals) order, dismissing the Revenue's appeal. The Tribunal concluded that there was no justification for rejecting the refund claim for the duty paid through DEPB scrips, aligning with the judicial precedents and legal principles established by higher courts.