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.
