Fraudulent claim of 4% SAD by unscrupulous importers – Board Alerts
NOTIFICATION No. dated 14.09.2007 provides exemption in the form of refund of 4% SAD paid on goods imported and subsequently sold on payment of VAT/ST. Instances have come to notice of the Board where some importers of ‘timber logs' have undertaken certain processes and subsequently sold ‘sawn' or ‘cut logs' after payment of VAT. These importers are claiming the refund of 4% SAD paid at the time of importation of goods in terms of Notification No.toms dated 14.09.2007. As per the said Notification , refund of SAD is available only in case the imported goods are subsequently sold on payment of VAT, without carrying out any process.
In certain other cases, refund claims have been filed with the department wherein forged documents were submitted for availing the refund envisaged in the notification No. dated 14.09.2007. In such cases, it is reported that the importers were preparing duplicate set of invoices of the same serial number. Scrutiny of these two sets of invoices establishes that the invoice submitted to the department shows description of goods as ‘Malaysian round logs' whereas the invoices obtained from the buyer shows the description of goods as ‘imported timber'.
CBEC apprehends that this modus-operandi may have all India ramifications and wants the field formations to be alert.
CBEC Circular No. 15/2010-Cus, Dated : June 29, 2010