Refund allowable to Importer who paid SAD on Imported Goods and Discharged VAT on Sales of Goods without indicating detail on Duty paid: CESTAT [Read Order]

The Customs, Excise & Service Tax Appellate Tribunal ( CESTAT ) of Chennai Bench has held that the refund is allowable to importers who paid Special Additional Duty ( SAD ) on imported goods and Discharged VAT on sales of goods without indicating detail of duty paid.

Mr B. Sivaraman, Advocate appeared on behalf of the Appellant and Ms Anandalakshmi Ganeshram appeared on behalf of the Respondent.

S. Vaidya and Company, the appellant filed three refund claims for a refund of the SAD amount of Rs.10,97,996/-. The adjudicating authority observed that the sales invoices were not endorsed with the mandatory declaration that “no cenvat credit can be availed on the invoices”. The refund was rejected and the Commissioner (Appeals) upheld the order passed by the adjudicating authority. Further observed that the Chartered Accountant certificate cannot be relied on to conclude that the appellant has not passed on the duty by issuing the sales invoices. 

In the case of Chowgule & Company (supra), it was held that “A trader-importer, who paid SAD on the imported goods and who discharged VAT/ST liability on a subsequent sale, and who issued commercial invoices without indicating any details of the duty paid, would be entitled to the benefit of exemption under Notification No.102/2007-Cus., even though he made no endorsement that “credit of duty is not admissible” on the commercial invoices, subject to the satisfaction of the other conditions stipulated therein.”

In light of the precedents, a Coram comprising of Mrs Sulekha Beevi C.S, Member (Judicial) and Mr Vasa Seshagiri Rao,  Member (Technical) held that the rejection of refund is without legal basis and while allowing the appeal set aside the impugned order.

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