Taxing provision favourable to Taxpayer should be adopted: CESTAT allows Refund of 4% of Special Additional Duty [Read Order]

The Customs, Excise, and Service Tax Appellate Tribunal (CESTAT) while allowing refund of 4% of Special Additional Duty held that taxing provision favorable to taxpayers should be adopted.

The assessee, John’s Cashew Company has raised the issue in respect of eligibility of the appellant for a refund of 4% of Special Additional Duty (SAD) in terms of Notification No.102/2007-Cus dt. 14/09/2007. The appellant made the above claim for refund and after due adjudication, vide the Order-in-Original dt. 04/08/2018, the Assistant Commissioner rejected 4% SAD of Rs.40,81,240/- being time-barred in terms of the above Notification. The Commissioner of Customs (Appeals), Cochin, vide the impugned Order-in-Appeal dt. 26/11/2018 upheld the rejection against which, the present appeal has been filed before this forum.

The appellant contended that neither the statute nor the original notification prescribed any limitation for claiming the refund of SAD and hence, imposition of time restriction by an Amending notification is clearly bad in law.

The coram of Judicial Member, P. Dinesha allowed an appeal which was filed with the point of consideration of eligibility of the appellant for a refund of 4% of Special Additional Duty (SAD). The appellant made the above claim for refund and after due adjudication, the Assistant Commissioner rejected 4% SAD being time-barred in terms of the above Notification. The Commissioner of Customs (Appeals), Cochin upheld the rejection against which, the present appeal had been filed before this forum.

The Tribunal explained that the doctrine of precedence only mandates that it is the ratio in the decision of higher courts to be followed, and not conclusions. The Tribunal was of the view that it will be wholly inappropriate to choose views of one of the High Courts based on perceptions about the reasonableness of the respective viewpoints, as such an exercise will de facto amount to sitting in judgment over the views of the Hon’ble High Courts- something diametrically opposed to the very basic principles of the hierarchical judicial system. When there is a reasonable interpretation of a legal and factual situation, which is favorable to the assessee, such an interpretation is to be adopted

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