Faxtel Systems (India)Pvt Ltd vs. The Principal Commissioner Customs - (Customs, Excise and Service Tax Appellate Tribunal) (25 Jun 2024)

In absence of any allegation of fraud or collusion, CA certificate is sufficient to grant the refund claim

MANU/CB/0139/2024

Customs

Issue in the present appeal is regarding refund of Special Additional Duty paid on import of goods. The Appellant had re-imported goods and it was cleared on payment of customs duty and 4% SAD as per Notification No. 102/207 dated 14.09.2007. Thereafter goods were sold and on payment of VAT, appellant submitted refund claim for refund of 4% SAD.

However, the refund application was rejected on the ground that the CA certificate has not stated as how the unjust enrichment was not applicable. Aggrieved by said order, an appeal was filed before Commissioner (Appeals) and considering the issue, the Commissioner (Appeals) remanded the matter to adjudication authority with a direction to the appellant to submit explanation from their CA as to how they arrive at the conclusion that the duty amount was not passed on to the customers. Thereafter adjudication authority considered the issue and even after submitting detailed explanation by the statutory auditor, the adjudication authority allowed refund partially.

The limited issue in the present appeal is regarding the defect related to refund claim submitted by the Appellant. It is the admitted fact, that appellant had paid 4% SAD at the time of import and the Appellant had also paid VAT as Customs Appeal No. 20817 of 2014 applicable while selling the goods. The Appellant also complied with the condition No. 2(b) in the Notification No. 102/2007 where it is stated that "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.

It is an admitted fact that the amount paid by the appellant as 4% SAD is not passed on to the buyers and the said aspect was confirmed by the statutory auditor of the appellant while issuing certificate. As regarding the objections made by lower authority, issue is squarely covered by the decisions of the Tribunal relied by the appellant, it is settled that once CA certificate is produced and in the absence of any allegation of fraud or collusion, such certificate is sufficient to grant the refund claim. Refund should not be denied merely on technical violations.

Impugned order rejecting the refund claim is not sustainable. Therefore, impugned order is set aside. Appeal allowed.

Tags : REFUND DENIAL LEGALITY