The Allahabad bench of the Customs, Excise & Service Tax Appellate Tribunal (CESTAT)has held that no Customs Duty on Manufacturing of Stainless Steel Coils Under Advance Authorisation Scheme. The tribunal held that the appellant is entitled to refund the claim of CVD amounting to Rs. 16,31,373/- along with interest as prescribed by law.
Vishal Metal Industries , the appellant is engaged in manufacturing of Stainless Steel Utensils and is registered with GST department. The appellant is also engaged in importing and exporting of goods for which the appellant is having IEC No. 3302002203. The appellant filed two bills of entry No. 3171879 and 3172213 both dated 09.09.2017 for import clearance of ‘stainless steel coils’. The appellant had imported the said goods under Advance Authorization Scheme. At the time of import, CVD @ 18.95% and
IGST @ 18% were levied in terms of Notification No. 1/2017-Customs (CVD) dated 07.09.2017 which was paid by the appellant and got the goods cleared.
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At the time of import, the appellant requested to assess the goods provisionally on furnishing of security in the shape of 100% bank guarantee but the respondent did not agree and assessed the goods finally on payment of CVD which was paid by the appellant under protest.
The raw materials imported under Advance Authorization Scheme were exempted vide Notification No. 18/2015-Cus dated 01.04.2015 from all kind of duties i.e. Basic Customs duty, whole of the additional duty, safeguard duty and anti dumping duty leviable under Section 3, 88, 8C and 9A of the Customs Tariff Act. Further, Government of India issued Notification No. 1/2017-Cus (CVD) dated 07.09.2017 whereby CVD has been levied @ 18.95% minus anti dumping duty under Section 9 of the Customs Tariff Act, 1975.
On account of various representations of the trade associations, Government of India vide Notification No. 79/2017-Cus dated 13.10.2017, exempted CVD levied under Section 9 of the Customs Tariff Act, 1975 when goods imported under Advance Authorization Scheme. Accordingly, DGFT also issued Notification No. 33/2015-2020 dated 13.10.2017 to exempt CVD under Advance Authorization Scheme.
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The appellant filed refund claim of CVD amounting to Rs. 16,31,373/- on account of exemption granted under aforesaid exemption Notification. The adjudicating authority rejected the refund on the ground that Notification in question is not applicable retrospectively in the appellant’s case and the judgments relied upon by the appellant is not applicable as the appellant was not the party in the said cases before the High court, thereafter, the appellant preferred first appeal before the Commissioner (Appeals) and the Commissioner (Appeals) dismissed the appeal vide impugned order.
It was argued that Foreign Trade Policy (FTP) 2015-2020 was notified by Trade Notification No. 1/2015-2020 dated 01.04.2015 and Notification No. 18/2015-Cus dated 01.04.2015 was issued to regularize FTP and enabling the duty of raw material under Advance Authorization Scheme. The levy of CVD under Section 9 is completely against the government intention and object of the whole scheme and upon the representation made by various Associations, government has rectified its mistake and exempt the goods from payment of CVD vide Notification No. 79/2017-Cus dated 13.10.2017.
A single bench of S S Garg observed that the Government of India vide Notification No. 1/2017-Customs dated 07.09.2017 imposed 18.95% CVD under Section 9 of Customs Tariff Act, but thereafter, trade associations made various representations and thereafter, the government vide Notification No. 79/2017-Cus dated 13.10.2017 exempted the CVD. DGFT also issued Notification No. 33/2015-2020 dated 13.10.2017 to exempt CVD under Advance Authorization Scheme.
While allowing the appeal , the tribunal held that the appellant is entitled to refund the claim of CVD amounting to Rs. 16,31,373/- along with interest as prescribed by law.
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