Case Law Details
Avon Cycles Ltd Vs Commissioner of Customs (CESTAT Bangalore)
In the case of Avon Cycles Ltd vs Commissioner of Customs, the primary issue revolved around the refund of Special Additional Duty (SAD) amounting to ₹43,798. Avon Cycles imported bicycles under Bills of Entry dated June 27, 2011, and August 18, 2011. After the sale of these bicycles and subsequent sales tax payment, the company submitted a refund application supported by a certificate from a Chartered Accountant. This certificate confirmed that the consignee had not claimed CENVAT credit on the SAD paid, as they did not possess Central Excise registration. However, the refund application was rejected because Avon Cycles did not include the necessary endorsement on the original sales invoices as stipulated in Paragraph 2(b) of Notification No. 102/2007-Cus.
Following the rejection, Avon Cycles appealed to the Commissioner (Appeals), who upheld the initial decision on the same grounds. In the subsequent hearings, the Appellant’s counsel argued that the application for refund included adequate documentation to meet the criteria outlined in the Notification. They cited a precedent set by a Larger Bench in the case of M/s Chowgule & Company Pvt Ltd vs CCC & C.Ex. This precedent established that traders who have paid SAD on imported goods and subsequently discharged VAT or sales tax liabilities could be entitled to refunds without needing to explicitly state that “credit of duty is not admissible” on their commercial invoices. The Tribunal reviewed the case and found that the requisite conditions of the notification were sufficiently met by Avon Cycles, leading to the conclusion that the appeal should be allowed, thus affirming their entitlement to the refund.
FULL TEXT OF THE CESTAT BANGALORE ORDER
The issue in the present appeals is regarding refund of Special Additional duty amounting to Rs.43,798/-. The Appellant had imported ‘Bicycles’ under Bills of Entry dated 27.06.2011 and 18.08.2011. After selling of the goods, on payment sales tax, Appellant had submitted refund application along with certificate issued by Chartered Accountant of the consignee certifying that they have not taken CENVAT credit on ACD/SAD paid as they are not holding Central Excise registration. However, refund application was rejected on the ground that the Appellant failed to affix proper endorsement in the original sales invoices as per Paragraph 2(b) of the Notification No. 102/2007-Cus dated 14.09.2007 as amended. Aggrieved by said order, an appeal was filed before the Commissioner (Appeals) and Commissioner (Appeals) also rejected the appeal on the very same ground. Aggrieved by said order, present appeal is filed.
2. When the appeal came up for hearing, Learned Counsel for the Appellant submits that they have submitted sufficient documents as per the ibid Notification to claim the due amount. Learned Counsel further submits that the issue is squarely covered by the decision of the Larger Bench in the matter of M/s Chowgule & Company Pvt Ltd vs CCC & C.Ex (2014 (306) E.L.T 326 (Tri. L.B), wherein it is held that the traders, who paid SAD on imported goods, and who discharged VAT/Sales Tax liability on 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 dated 14.09.2007, notwithstanding the fact that 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. Learned Counsel also relied the decision of the Tribunal in the matter of M/s Equinox Solution Ltd vs Commissioner of Customs (Import), Mumbai (2011 (272) E.L.T 310 (T) and M/s Chowgule & Company Pvt Ltd vs Commissioner of Central Excise, Goa (2015 (315) E.L.T 417 (T).
3. Learned Authorised Representative (AR) for the Revenue reiterated the finding and submits that the Appellant is not eligible to claim SAD, since they have failed to comply with the conditions of the Notification.
4. Heard both sides and perused the records. There is no dispute that refund application was filed along with certificate issued by Chartered Accountant of the consignee certifying that they have not taken CENVAT credit on ACD paid as they are not holding Central Excise registration. Thus, the issue is squarely covered by the decision of Larger Bench in the matter of M/s Chowgule & Company Pvt.,, (Supra). Hence, the Appeal is allowed with consequential relief, if any in accordance with law.
(Order pronounced in open court on 13.09.2024)
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