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TMI Blog2010 (9) TMI 950X X X X Extracts X X X X X X X X Extracts X X X X ..... rated therein - the department has not proved or shown any evidence that goods have undergone manufacture and therefore SAD benefit is not available. No evidence has been put forth show that sawn timber is classifiable under CETH 4407 - sawn timber and timber laws are treated as one category of goods. Revenue has not been able to make out a case that the process undertaken by the appellants has resulted in different product thereby rendering them ineligible for refund of the special CVD paid by them - appeal allowed - decided in favor of appellant. X X X X Extracts X X X X X X X X Extracts X X X X ..... led: (a) the importer of the said goods shall pay all duties, including the said additional duty of customs leviable thereon, as applicable, at the time of importation of the goods; (b) the importer, while issuing the invoice for sale of the said goods, shall specifically indicate in the invoice that in respect of the goods covered therein, no credit of the additional duty of customs levied under sub-section (5) of section 3 of the Customs Tariff Act, 1975 shall be admissible; (c) the importer shall file a claim for refund of the said additional duty of customs paid on the imported goods with the jurisdictional customs officer; (d) the importer shall pay on sale of the said goods, appropriate sales tax or value added tax, as the case may be; (e) the importer shall, inter alia, provide copies of the following documents alongwith the refund claim: (i) document evidencing payment of the said additional duty; (ii) invoices of sale of the imported goods in respect of which refund of the said additional duty is claimed; (iii) documents evidencing payment of appropriate sales tax or value added tax, as the case may be, by the importer, on sale of such imported goods." 6. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tion of the imported item remains the same. For this purpose reliance was placed on the decision of the Tribunal in the case of CCE Madras vs. Kutti Flush Doors and Furniture Co. (P) Ltd. reported in 1988 (35) ELT 6 (S.C.). In this case it was held that sawn timber is non excisable and does not attract duty under item 68 of the Erstwhile Central Excise Tariff. Similar was the decision of the Hon'ble Karnataka High Court in the case of Y. Moideen Kunhi and Others vs. CCE reported in 1986 (23) ELT 293 (Kar.). It is noticed that all the decisions relating to manufacture in respect of timber relied upon by the appellants relate to the period prior to introduction of the Tariff based on HSN and the decisions were rendered holding that sawn timber cannot be levied to duty under item 68 of the Erstwhile Tariff. Nevertheless to levy duty under CETH 4407, if the timber had been classified under 4403 at the time of importation and duty is proposed to be levied as sawn timber under CETH 4407, the department would be required to show that the process amounted to manufacture and new commodity with distinct, character, name and use has emerged. Therefore it can be said that if the process did no ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... burden of local taxes on domestic producers. This duty should not be viewed as a protectionist measure but only as a response to a legitimate demand for a level playing field. The new levy would not apply to crude oil, newsprint, capital goods sector under a special tariff regime or goods which are subjected to additional duties of excise in lieu of sales tax, gold and silver imported by passengers or other nominated agencies and life saving drugs that are free from customs duties. The levy would also not apply to goods which are currently exempt both from basic and additional duties of customs. Similarly, goods imported for subsequent trading have also been left out of its purview, since they bear the burden f sales tax at the time of first sale. The new levy will also not apply to inputs imported under export promotion schemes. In addition, there may be other sectors eligible for exemptions. These would be examined and if considered appropriate notified separately. Section 3A(1) as enacted read as under:- 3A. Special additional duty. (1) Any article which is imported into India shall in addition be liable to a duty (hereinafter referred to in this section as the special additi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... al taxes like Sales Tax and VAT leviable on goods on their sale or purchase in India. Section 3(5) reads as under:- (5) If the Central Government is satisfied that it is necessary in the public interest to levy on any imported article [whether on such article duty is leviable under Sub-Section (1) or, as the case may be, sub-section (3) or not] such additional duty as would counter-balance the sales tax, value added tax, local tax or any other charges for the time being leviable on a like article on its sale, purchase or transportation in India, it may, by notification in the Official Gazette, direct that such imported article shall, in addition, be liable to an additional duty at a rate not exceeding four per cent of the value of the imported article as specified in that notification. Explanation:- In this sub-section, the expression sales tax, value added tax, local tax or any other charges for the time being leviable on a like article on its sale, purchase or transportation in India means the sales tax, value added tax, local tax or other charges for the time being in force, which would be leviable on a like article if sold, purchased or transported in India or, if a like art ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the Customs Tariff Act. The goods have not undergone any change by any process and they remained the same even on repacking. The term as such referred to in the Notification is to mean that the goods should not undergo any process of change. This change has not taken place admittedly on being repacking. Therefore, invocation of Chapter Note of Chapter 29 to hold that the goods have not been sold as such is not correct in the light of the interpretation placed by us. The goods have remained the same and they have sold as such and paid the sales tax. Therefore, the view taken by the department that the goods are not sold as such on being repacked is not a correct one as there is no such definition given to the term as suchin the Notification. So long as the same goods are sold as such either in the same condition or in the repacked condition, the benefit cannot be denied to them. Moreover, the purpose of levy of SAD is to make it par with the local sales on payment of sales tax. As the sales tax has been levied in the present case, the question of again levying SAD does not arise. Furthermore, we notice that the High Court of Karnataka, in the case of Lipton India Ltd. v. State of K ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... appellants ineligible for the refund. Even when the words as such were used, the Tribunal had taken a view that re-packing would not render the appellants ineligible for exemption, that too even when such a process amounted to manufacture. There is no such chapter note regarding deemed manufacture in the case of articles under consideration and the words as such have also been taken out from the notification. Nevertheless fact remains that the very introductory paragraph of the notification provides that exemption is available when goods are imported into India for subsequent sale. Therefore it is possible to draw a conclusion that if imported goods are not sold in the form in which they were imported, appellants would not be eligible for refund. Since special CVD is levied in lieu of sales tax and also the very introduction refers this fact, it would be relevant to consider the submissions made by the appellants relying upon decisions of Hon'ble High Court and Supreme Court in support of the contention that sawn timber and timber are same goods. In the case of State of Orissa and Other vs. Titaghur Paper Mills Company Ltd. and Another reported in 1985 (Supp) SCC (280) the questio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... l Forest Officer cannot call upon assessee to reimburse the tax, since tax is payable only once on same goods. Since assessee has already paid sales tax at the time of sale of sized logs by it to its customers no tax is payable on the sale of timber by the Forest Officer to the assessee. 21. Sales tax department therefore contended timber as severed from the forest and sawn or dressed logs are not same goods. Therefore, according to sales tax department, levy of sale tax once sale of standing timber by Forest Officer to assessee i.e. forest contractor and again on sale of sawn/dressed logs by forest contractor to its customers would not violate Section 8 or its proviso. Supreme Court rejected this contention and held that timber and sawn/dressed logs are same goods: within the meaning of proviso to Section 8. 22. Supreme Court duly noted the position that under Orissa Sales Tax Act, State Government has made Rules specifying that the tax would be levied at the first point of sale and same goods shall not be taxed more than once. Supreme Court held that the timber and sized or dressed logs are one and the same commercial commodity. Supreme Court also held that merely because an it ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... stries, the contention raised by the Revenue in the present case, that imported goods fall under Heading 44.03 and sawn timber falls under Heading 44.07 of Customs Tariff and this establishes these two are not the same goods is incorrect. 29. The case of State of Maharashtra vs. Shiv Datt and Sons and Others reported in 1993 Supp (1) Supreme Court Cases 222 was cited in support of the contention that where there was a sale of recharged batteries by the dealer who purchased them as dry batteries from the manufacturer, it was held that there was no manufacture involved in reintroducing the electric light and re-charging the batteries for sale and the dealer was entitled for concession under Section 8 of deduction from turnover of goods sold on which purchase tax had already been paid. This decision also supports the case that even when the timber was sawn and sold, if the sales tax liability was discharged, the appellants would be eligible for refund. 30. Learned DR on behalf of Revenue drew our attention to the Circular No.15/2010-Cus dated 29.06.10 issued by the Board. In the Circular it has been stated that refund of SAD is available only in the case of imported goods are subseq ..... X X X X Extracts X X X X X X X X Extracts X X X X
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