Rejection of claim for refund of additional duty of customs

PJ/CASE LAW/2016-17/3225

Case-Shri B. Ravichandran, Member (T) RADIUS INFOTECH Versus C.C., NEW DELHI (CARGO EXPORT)

Citation-2016 (337) E.L.T. 305 (Tri. - Del.)

Brief Facts-The appeal is against the order dated 19-6-2015 of the Commissioner of Customs (Appeals) Airport, New Delhi. The brief facts of the case are that the appellant are engaged in import and sale of various electronic items. They have refund claim for an amount of Rs. 1,50,272/- in terms of Notification No. 102/2007-Cus., dated 14-9-2007 for additional duty of customs. The Original Authority sanctioned an amount of Rs. 60,166/- and rejected the claim for Rs. 90,106/-. The main reason for rejection of the said amount is that the appellant had issued sales invoice dated 21-4-2013 in respect of 379 pieces of imported goods which were covered by the Bill of Entry dated 23-4-2013 and released by the Customs on 26-4-2013. Since the imported goods were shown as sold 5 days before on release by the Customs, refund of additional duty on these goods was rejected.

Appelants Contention-Ld. Consultant on behalf of the appellant submitted that the imported goods have been sold in terms of invoice dated 21-4-2013 but the delivery was made as per delivery challan dated 29-4-2013 only. He submitted that in terms of Master Supply Agreement dated 22-4-2012 between the appellant and the Indian buyer of the imported goods, the seller shall raise invoice for the charges once the product is ready to shift from China to India with required customized features (Clause 4.2). Ld. Consultant submitted that the Original Authority erred in holding that the sale occurred prior to release of the goods by the Customs. There is no bar in issuing an invoice and delivering the goods later and in fact in terms of the agreement as stated above, they have to issue invoice once the goods are ready for shipment from China. The ld. Consultant submitted that delivery challan dated 29-4-2013 is for the goods covered by invoice dated 21-4-2013. He further submitted that they have fulfilled all the conditions in terms of the notification mentioned above and that is not disputed by the Department also.

Respondents Contention-Ld. AR reiterated the findings of the lower authorities and submitted that the invoice raised prior to release of the goods by the Customs should show that the imported goods were not sold on VAT payment by the appellant.
Reasoning Of Judgement-On perusal of the appeal records, it is clear that the refund of Rs. 90,106/- was rejected only on the ground that the invoice dated 21-4-2013 is prior to the date of Bill of Entry. The Original Authority recorded that it is doubtful as to whether the same goods were sold, which were imported. On such doubt, the refund was rejected. On the other hand, the appellant submitted delivery challan and the other evidence along with the terms of agreement to establish that the issue of invoice 5 days before the release of the goods by the Customs by itself does not prove that the goods have been sold and delivered to the buyers. It is also seen that the appellant has filed reconciliation certificate with calculation sheet certified by a Chartered Accountant containing details of Bills of Entry and sale invoices and payment of VAT/CST.

Decision-Appeal allowed

Comment-The crux of the case is the appellant produced evidence such as delivery challans, agreement with buyers for issuing invoices when goods ready for shipment from exporting country and conciliation certificate of Chartered Accountant containing details of B/E, sales invoices and VAT/CST payment. Thus, rejection of refund is not sustainable as per Section 27 of Customs Act, 1962

Prepared By-Ritika Mehta

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PJ/CASE LAW/2016-17/3225

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