SAD Refund - Can time period be Extended Please?
AS per Notification No 102/2007 Cus dated 14.09.2007, if the goods imported are for subsequent sale, the importers are entitled for refund of the Additional Duty of Customs levied under sub-section 5 of Section 3 of the Customs Tariff Act, 1975. Even under the special drive for expeditious disposal of the refund claims, the importers are required to submit the following documents for claiming refund.
(a) TR-6 Challans (in original) for CVD payment; (b) VAT/ST payment Challans (in original); (c) summary of sale invoices; and (d) certificate of statutory Auditor/Chartered Accountant, for correlating the payment of ST/VAT on the imported goods with the invoices of sale and also to the effect that the burden of 4% CVD has not been passed on by the importer to the buyer.
Initially there was no time limit for claiming the refund under Notification No 102/2007 Cus dated 14.09.2007, but vide amending Notification No 93/2008 Cus dated 01.08.2008, the time limit for claiming the refund has been prescribed as “before the expiry of one year from the date of making payment of the said additional duty of customs”.
The rationale behind the above amendment has been explained by the CBEC vide Circular No 6/2008-Cus dated 28.04.2008 as under:
Time - Limit:
In the Notification No. 102/2007-Customs, dated 4.1 14-9-2007, no specific time limit has been prescribed for filing a refund application. Under the circumstances, a doubt has been expressed that whether the normal time-limit of six months prescribed in Section 27 of the Customs Act, would apply. In the absence of specific provision of Section 27 being made applicable in the said notification, the time limit prescribed in this section would not be automatically applicable to refunds under the notification. Further, it was also represented that the goods imported may have to be despatched for sale to different parts of the country and that the importer may find it difficult to dispose of the imported goods and complete the requisite documentation within the normal period of six months. Taking into account various factors, it has been decided to permit importers to file claims under the above exemption upto a period of one year from the date of payment of duty. Necessary change in the notification is being made so as to incorporate a specific provision prescribing maximum time limit of one year from the date of payment of duty, within which therefund could be filed by any person. It is also clarified that the importers would be entitled to refund of duties only in respect of quantities for which the prescribed documents are made available and the claims submitted within the maximum prescribed time of one year. Unsold stocks would not be eligible for refunds.
DDT has received a mail from a Netizen expressing the difficulties of the importers in disposing the imported goods and filing the claims within one year. He says there are a good number of customers who have had to bear the loss due to non-relaxation of the filing period. It should be further extended for a period of one more year.
Interestingly, when the time limit for claiming refunds under Section 27 was six months, the time limit under Notification No 102/2007 Cus is one year. Now Section 27 has been amended vide Finance Act, 2011 to enhance the time limit from six months to one year. Thus the demand for extending the time limit under Notification No 102/2007 Cus also appears reasonable. Hope the Board will consider it.