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TMI Blog2018 (11) TMI 1531X X X X Extracts X X X X X X X X Extracts X X X X ..... lied by SEZ unit and received by DTA unit of the same company who sold the goods in the market therefore, in the transaction, consignment agent does not exist. The question of fulfilling a condition mentioned at point (vii) of the Circular dated 13.10.2008 does not arise. Therefore, on this count also the lower authorities have gravely erred in rejecting the refund claim. Rejection of refund claim also on the ground of transfer of goods from SEZ to DTA unit is not an import - Held that:- As per SEZ Act, 2005 and the legal fiction provided therein, the supply made from SEZ is treated as import for the receiving DTA unit and in case of any supply from DTA to SEZ, the same is treated as export - supply of goods from Special Economic Zone (SEZ) to Domestic Tariff Area (DTA) is eligible for exemption Notification No. 102/2007-Cus and consequently, the DTA unit is entitled for the refund of Special Additional Duty of customs paid on such supply. Refund cannot be rejected - appeal allowed - decided in favor of appellant. - Appeal No. C/10364/2016-DB - A/12674/2018 - Dated:- 27-11-2018 - Mr. Ramesh Nair, Member (Judicial) And Mr. Raju, Member (Technical) Shri Paritosh Gupta, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... filed by importer himself and therefore, the same is liable to be rejected. He submits that this finding is not only factually incorrect but also without any understanding of the organization of the appellant company. He submits that it is pertinent to note that pursuant to the judgment of the Hon'ble High Court in the petition filed by the appellant, the DTA unit of the appellant situated at Bhimasar filed the refund claim dated 12.12.2013 with the Adjudicating Authority. He submits that since the refund claim was filed by Bhimasar unit, which is a DTA unit and in case of supply to SEZ to DTA unit, the DTA unit is an importer and therefore, the refund claim was rightly filed by the Bhimasar unit as an importer. He further submits that since the SEZ unit and the DTA unit belongs to one entity i.e. one company, it does not make any difference. He further submits that the lower authorities have committed a grave error in concluding that the refund claim was not maintainable because the appellant has not satisfied the condition as provided in Circular No. 16/2008 dated 13.10.2008 inasmuch as the point No. (vii) of the Circular was not complied with which required to be satisfied b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... le when the goods are sold by a consignment agent, which obviously other than own company. In the present case, the goods were supplied by SEZ unit and received by DTA unit of the same company who sold the goods in the market therefore, in the transaction, consignment agent does not exist. The question of fulfilling a condition mentioned at point (vii) of the Circular dated 13.10.2008 does not arise. Therefore, on this count also the lower authorities have gravely erred in rejecting the refund claim. As regards the rejection of refund claim on the ground of transfer of goods from SEZ to DTA unit is not an import, we have already discussed above that as per SEZ Act, 2005 and the legal fiction provided therein, the supply made from SEZ is treated as import for the receiving DTA unit and in case of any supply from DTA to SEZ, the same is treated as export. This issue is squarely covered by the decision cited by the ld. Counsel in the case of Adinath Trade Link vs. CC, Kandla - 2013 (293) ELT 746 (Tri. Ahmd.) (supra) wherein the Tribunal has held as under:- 6. We have considered the submissions made by both the sides and perused the records. 7. The issue involved in all thes ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... bove reproduced Section that any goods which are removed from SEZ to DTA, customs duties shall be chargeable, wherever applicable, as leviable on such goods when imported. In short, there is a legal fiction which has been created for discharge of customs duties on the movement of goods from SEZ to DTA considering the said goods as being imported. It is undisputed that SAD is duty of customs and is leviable on the goods which are imported and also levied as goods moving from SEZ to DTA. There is no dispute that the SAD leviable has been discharged by the appellant herein. This takes us to refund claim filed by the appellant for the said SAD Notification No. 102/2007-Cus. In order to appreciate the correct position, we reproduce the notification as it stands : Exemption from special CVD to all goods imported for subsequent sale when VAT/Sales Tax paid by importer: In exercise of the powers conferred by sub-section (1) of Section 25 of the Customs Act, 1962 (52 of 1962), the Central Government, on being satisfied that it is necessary in the public interest so to do, hereby exempts the goods falling within the First Schedule to the Customs Tariff Act, 1975 (51 of 1975), when i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... o talks about applicability and leviability of such SAD when goods imported. It would mean that when the goods move from SEZ to DTA, the leviability of SAD is on the goods arises, as such movement is considered as when imported to India . In our view, benefit of Notification No. 102/2007-Cus. cannot be denied to the appellants, for the reason that when goods move from SEZ to DTA, leviability of SAD is not in doubt, calculation of SAD is not in doubt and subsequent sale of goods is also not in doubt. The entire provisions relating to refund under Notification No. 102/2007-Cus., would indicate that the Government of India had an intention to refund the amount of SAD paid by any importer, even if the goods are procured from SEZ, subject to conditions in the notification. In our view, the appellants have properly demonstrated before us that they have fulfilled the conditions of Notification No. 102/2007-Cus. 13. We find for the cases in hand the observations of the Hon ble Apex Court in the case of Industrial Suppliers Pvt. Ltd. (supra) are very relevant. We respectfully reproduce the relevant paragraphs. It is now axiomatic that when a legal fiction is incorporated in a sta ..... 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