Standard Conduits Pvt. Ltd vs Commissioner Of Customs (Import)

IN THE CUSTOMS, EXCISE & SERVICE TAX APPELLATE TRIBUNAL, WEST ZONAL BENCH AT MUMBAI

COURT No. II

APPEAL No.c/86392/13

(Arising out of Order-in-Appeal No.24/MCH/DC/CRARS/2013 dated 04/01/2013 passed by Commissioner of Customs (Appeals), Mumbai)

For approval and signature:

Honble Mr. P.R. Chandrasekharan, Member (Technical)

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1. Whether Press Reporters may be allowed to see : No the Order for publication as per Rule 27 of the CESTAT (Procedure) Rules, 1982?

2. Whether it should be released under Rule 27 of the : Yes CESTAT (Procedure) Rules, 1982 for publication in any authoritative report or not?

3. Whether Their Lordships wish to see the fair copy : Seen of the Order?

4. Whether Order is to be circulated to the Departmental: Yes authorities?

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Standard Conduits Pvt. Ltd., Appellant Vs. Commissioner of Customs (Import), Mumbai Respondent

Appearance: Shri.J.C.Patel, Advocate for appellant Shri.S.J.Shahu, Asst. Comm. (AR), for respondent

CORAM: Honble Mr. P.R. Chandrasekharan, Member (Technical)

Date of Hearing : 02/01/2015 Date of Decision : 02/01/2015

ORDER NO

The appeal is directed against Order-in-Appeal No.24/MCH/DC/CRARS/2013 dated 04/01/2013 passed by Commissioner of Customs (Appeals), Mumbai. Vide the impugned order, the learned lower appellate authority has rejected the refund to the extent of Rs.55,673/- in respect of sales invoice dated 02/11/2009 in respect of sale of goods weighing 29.780 MTs. The reason for rejecting this amount is that VAT/Sales Tax amount was paid on 14/12/2009, which is subsequent to filing of refund application on 20/11/2009 and therefore, at the time of filing of refund claim, the appellant had not fulfilled the condition of payment of VAT and hence the said amount is not eligible for refund. Hence the appeal.

2. The learned Counsel for the appellant submits that in the present case the Special Additional Duty (SAD) of Customs was paid in respect of Bill of Entry No.876192 dated 26/08/2008 on 07/01/2009. The goods imported under the said bill of entry were sold over a period time and one such VAT payment was on 14/12/2009 in respect of invoice dated 02/11/2009. The sale had been effected in respect of said invoice on 02/11/2009. Inasmuch as the appellant is entitled to a time limit of 21 days from the close of the month for payment of VAT, the actual remittance of tax was made on 14/12/2009. Otherwise, the sale in respect of which refund claim was made had been completed on 02/11/2009 before the submission of the refund claim. In any case, since the VAT liability has also been discharged on 14/02/2009, that is, within a period of one year from the date of payment of SAD, the department should not have rejected the refund claim for the amount of Rs.55,673/- relating to the invoice dated 02/11/2009. Accordingly, he pleads for setting aside the impugned order and allowing the appeal.

3. The learned Assistant Commissioner (AR) appearing for the Revenue while admitting the fact mentioned by the learned Counsel for the appellant submits that when the refund claim was filed on 20/11/2009, the appellant had not discharged the VAT liability to the extent of Rs.55,673/- and therefore, as on the date of filing of refund claim the appellant was not eligible for the refund of the said amount. Accordingly, he pleads for upholding the impugned order.

4. I have carefully considered the submissions made by both the sides.

4.1 The refund of SAD paid on payment of VAT on subsequent sale is governed by the provisions of Notification No.102/2007-Cus dated 14/09/2007. The conditions stipulated therein are that the goods sold in the domestic market on payment of Sales Tax/VAT and the documents evidencing payment of SAD and payment of appropriate sales tax should be produced and the claim should be made within a period of one year from the date of payment of SAD. It is not in dispute that any of these conditions have been violated. In other words, the appellant has complied with all the substantive conditions which make him eligible for refund of SAD paid. The argument that at the time of filing of the refund as on 20/11/2009, the appellant had not discharged VAT liability to the extent of Rs.55,673/-, which could at best be considered as a premature claim, but the facts remains that the appellant had paid this amount on 14/12/2009, that is, within a period of one year. Therefore, rejection of refund claim on a technical ground is not sustainable in law. Accordingly I set aside the impugned order and allow the appeal with consequential relief, if any, in accordance with law.

(Dictated in Court)

(P.R. Chandrasekharan) Member (Technical)

pj

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