The Ahmedabad bench of Customs, Excise and Service Tax Appellate Tribunal (CESTAT) has held that manufacturing of stainless steel coils under Advance Authorisation Scheme is exempted from all duties under Customs Tariff Act.
The bench of S. S. Garg (Judicial Member) has observed that the Government of India vide Notification No. 1/2017-Customs dated 07.09.2017 imposed 18.95% CVD under Section 9 of Customs Tariff Act, but thereafter, trade associations made various representations and thereafter, the government vide Notification No. 79/2017-Cus dated 13.10.2017 exempted the CVD. DGFT also issued Notification No. 33/2015-2020 dated 13.10.2017 to exempt CVD under Advance Authorization Scheme.
Table of Contents
Background
The appellant/assessee is in the business of manufacturing of Stainless Steel Utensils and is registered with the GST department. The appellant is also engaged in importing and exporting of goods for which the appellant is having an IEC number.
The raw materials imported under Advance Authorization Scheme were exempted vide Notification No. 18/2015-Cus dated 01.04.2015 from all kind of duties i.e. Basic Customs duty, whole of the additional duty, safeguard duty and anti dumping duty leviable under Section 3, 88, 8C and 9A of the Customs Tariff Act.
The Government of India issued Notification No. 1/2017-Cus (CVD) dated 07.09.2017 whereby CVD has been levied @ 18.95% minus anti dumping duty under Section 9 of the Customs Tariff Act, 1975.
On account of various representations of the trade associations, Government of India vide Notification No. 79/2017-Cus dated 13.10.2017, exempted CVD levied under Section 9 of the Customs Tariff Act, 1975 when goods imported under Advance Authorization Scheme. The DGFT also issued Notification No. 33/2015-2020 dated 13.10.2017 to exempt CVD under Advance Authorization Scheme.
The appellant filed a refund claim of CVD on account of exemption granted under aforesaid exemption Notification dated 13.10.2017 and he has filed various documents to substantiate the claim. The adjudicating authority rejected the refund on the ground that Notification in question is not applicable retrospectively in the appellant’s case and the judgments relied upon by the appellant is not applicable as the appellant was not the party in the said cases before the Hon’ble High court, thereafter, the appellant preferred first appeal before the Commissioner (Appeals) and the Commissioner (Appeals) dismissed the appeal.
Arguments
The assessee contended that order is not sustainable in law as the same has been passed by ignoring the precedent decisions on identical issues. He further submits that appellant imported the goods under Advance Authorization Scheme for processing and manufacturing of goods meant for export and there is no duty on export of goods.
The assessee contended that under Advance Authorization Scheme, raw material can be imported without payment of all kind of customs duty and this has been done for increasing the export of goods. The levy of CVD under Section 9 on goods imported under Advance Authorization Scheme was never the intention of the government and it has been rectified vide Notification No. 79/2017-Cus dated 13.10.2017.
The assessee argued that Foreign Trade Policy (FTP) 2015-2020 was notified by Trade Notification No. 1/2015-2020 dated 01.04.2015 and Notification No. 18/2015-Cus dated 01.04.2015 was issued to regularize FTP and enabling the duty of raw material under Advance Authorization Scheme. The levy of CVD under Section 9 is completely against the government intention and object of the whole scheme and upon the representation made by various Associations, government has rectified its mistake and exempt the goods from payment of CVD vide Notification No. 79/2017-Cus dated 13.10.2017.
Conclusion
The tribunal allowed the appeal of the appellant and held that the appellant is entitled to refund the claim of CVD amounting to Rs. 16,31,373/- along with interest as prescribed by law.
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Case Details
Case Title: Vishal Metal Industries Versus Commissioner of Customs, Noida
Case No.: Customs Appeal No. 70117 of 2021
Date: 29.10.2024
Counsel For Appellant: Naveen Bindal
Counsel For Respondent: A.K. Choudhary
