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TMI Blog2019 (4) TMI 1712X X X X Extracts X X X X X X X X Extracts X X X X ..... Chain, Socket wrench, Torque Wrench, C-Clamp, Manila rope, Wire Rope, 745 KV & 145 KV Bushing, 500 NVA 765/400 KVA, Single phase Auto Transformer, Local control panel, Hydran M2, 80 MVAR 765 KV, single phase Auto Transformer, Local control panel, Hydran M2, 80 MVAR 765 KV Singe Phase Bus Reactor,120 KN & 210 KN Toughened Glass Disc Insulator at Custom House - MP & SEZ, Mundra. The goods were cleared by filing B/E No. 6186246 dated 6.3.12, 6186247 dated 6.3.12, 6130149 dated 29.2.12, 6130148 dated 29.2.12, 6186248 dated 6.3.12, 6118467 dated 28.2.12, 6257843 dated 4.3.12, 6257846 dated 14.3.12, 6118400 dated 28.2.12 and 6225685 dated 12.3.12 with claim for benefits of Project Import against the Contract No. MEGPTCL/PMC/AD/03/10 dated 27.09.2010 made with M/s Maharashtra Eastern Grid Power Transmission Co Ltd. 2. The supply of goods imported by the claimant were stated to have been recommended by the Principal (Energy), Government of Maharashtra, Energy Industries and Labour Deptt. Mantralaya, Mumbai vide recommendation letter No. CUM-2011/CR 452/NRG-4 dated 8.12.2011 No. CUM-2011/CR 359/NRG-4 dt 21.10.2011, CUM-2011/CR 394/NRG-4 dated 31.10.2011 & Cl-2011/CR 453 /NRG-4 dated 8.12 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... contract. In that case, the identity of the goods at the time of importation does not remain same and it gets merged into the contracted single unit of '765KV & 400KV Substation'. The part sale of goods shown by the Respondent on paper only to avail refund of SAD for which they were otherwise not entitled. Thus the refund is not admissible. The Appellate authority has relied on purchase order of M/s Maharashtra Eastern Grid Power Transmission Co. Ltd. as per Para 2.1 of which - "The total Contract price is inclusive of Freight & Insurance (F & TI) Charges for Onshore supply items/ materials and Taxes & Duties except octroi and entry tax which shall be paid extra at actual, if applicable. Thus it is clear that the burden of taxes including VAT has been passed on to the buyer. The price paid by the buyer includes "VAT" in addition to other taxes has already been included in price paid by M/s Maharashtra Eastern Grid Power Transmission Co. Ltd. Therefore the same has been passed on to the buyer and the doctrine of unjust enrichment is applicable. The Respondent has availed double benefit. The copy of invoice of Respondent are not co-related with import document as the invoice of Respo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... importation of the goods and after submitting the evidence of payment of VAT/ Sales tax, he is eligible for the refund of 4% SAD. We find that the impugned goods were imported under 10 Bill of Entries. The revenue has objected to the refund claim on the ground that the goods were imported for execution of EPC Contract and thus once used and undergone process has lost their identity and therefore did not remain as such. Also that the Respondent has recovered the duty charged by them on the sale of finished goods to the buyer and thus the refund is hit by clause of unjust enrichment. The revenue has relied upon the Project import Regulations that if the goods were imported as single or composite machines the Respondent would not have been eligible for project import benefits. We find that the notification in question provides for exemption/refund of SAD if the imported goods are subsequently sold and they have suffered VAT/ CST. We agree with the views of the Appellate Commissioner that the provision of one statute i.e. Project Regulations cannot be imported into the provisions of Notification No. 102/2007-Cus to interpret and deny the exemption/ refund of SAD. Once the assessee has ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ariff Act, 1975 shall be admissible; (c) the importer shall file a claim for refund of the said additional duty of customs paid on the imported goods with the jurisdictional customs officer; (d) the importer shall pay on sale of the said goods, appropriate sales tax or value added tax, as the case may be; (e) the importer shall, inter alia, provide copies of the following documents alongwith the refund claim: (i) document evidencing payment of the said additional duty; (ii) invoices of sale of the imported goods in respect of which refund of the said additional duty is claimed; (iii) documents evidencing payment of appropriate sales tax or value added tax, as the case may be, by the importer, on sale of such imported goods". 6. Thus, from the perusal of the notification, it is clear that for refund of SAD the main conditions to be satisfied are - (a) 'The goods have been imported for sale; (b) On sale of the goods, appropriate sales tax or VAT has been paid; and (c) The sales invoices specifically indicate that no credit of the SAD paid under Section 3(5) of the Customs Tariff Act, 1975 shall be admissible'. 7. The main purpose of the exemption is th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ipments to the project. It is also an admitted fact that they have completed the installation and commissioning of the entire project and supplied the complete project (Electric Sub-Station) to the buyer under the said invoices. The respondent had submitted before the adjudicating authority the copies of CST returns, sales invoice and CST payment challans in support of their claim and total tax liability of CST of Rs. 7.32 crore was deposited by them under 2 separate challans dated 19.4.12 for Rs. 3 crore and challan dated 24.2.12 for Rs. 4.32 crore. It is absolutely clear that the imported goods has been transferred to the buyer by way of subsequent sale of such goods under the cover of sales invoices, for which they have received payment from the buyer on pro-rata basis, as per the terms of purchase order. It shows that the Respondent also acted as supplier of all impugned equipment / goods by virtue of Section 2 (9) of the CST Act which states - that a sale of goods is transfer of property in goods by one person to another for cash or for deferred payment or for any other valuable consideration and includes a transfer of goods on the hire purchase or other system of payment by i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and that the only method to ensure this is to make it conditional to satisfy the principal of unjust enrichment. It is not the case of the appellant department that the respondent had not furnished documentary evidences regarding not passing on the incidence of 4% SAD to their buyer. The lower authorities have confirmed that the Respondent had submitted such documentary evidences in compliance. In such case we are of the view that the refund to the Respondent is not hit by unjust enrichment clause. The recovery of VAT by the Respondent on subsequent sale does not casts any effect on exemption from SAD as the unjust enrichment would apply only if the Claimant recovers the SAD amount from buyers. The Appellate Authority has also examined the issue as to whether the Respondent has passed on the SAD Component to their buyer whether it pertains to passing on SAD component to the buyers. He has observed that none of the sales invoices were issued by the Respondent under rule 11 of the Central Excise Rules to enable the buyer to avail cenvat credit nor the invoices indicate the SAD component separately as available credit. That each invoice carry a declaration regarding non-eligibility o ..... X X X X Extracts X X X X X X X X Extracts X X X X
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