CESTAT confirms Interest on delayed Sanction of Refund Claim, under benefit of section 27A of Customs Act [Read Order]

The Customs, Excise and Service Tax Appellate Tribunal (CESTAT), Mumbai confirmed interest on delayed sanction of refund claim, under benefit of section 27A of Customs Act.

The Revenue is aggrieved by the order of the Commissioner of Income Tax (Appeals), in which, in appeal of claimant against rejection of their entitlement for interest on delayed sanction of refund claim, M/s. Pidilite Industries Ltd was allowed the benefit of section 27A of Customs Act, 1962.

The respondent in the present case, M/s. Pidilite Industries Ltd claimed refund of Rs 42,46,426 and Rs 28,47,836 on 22nd August 2013 and 18th November 2013 respectively, being the differential ‘additional duty’ discharged by them on assessment of eighteen bills of entry arising from resort of ‘retail sale price’ by assessing officer instead of ‘transaction value’ as claimed by them and confirmed by the first appellate authority.

Later the order was found to be contrary to law by the Tribunal and held that the assessee entitled to consequential relief arising thereof, which were finally allowed by two orders dated 9th March 2017. Their claim thereafter for appropriate interest, as provided for in section 27A of Customs Act, 1962, rejected initially by the original authority, was, on appeal, allowed in the order impugned by Revenue.

A Single Bench consisting of C J Mathew, Judicial Member observed that “It is seen that the first appellate authority has interpreted the time limit in section 27A of Customs Act, 1962 according to the letter of the law which mandates liability of interest for any delay in sanction of refund beyond three months from date of claim. It is on record that there has been delay beyond the stipulated period of three months.”

S.B. Hatangadi, AC (Authorised Representative) appeared for the appellant and a Shekhar A. Sawantdesai, Company Representative appeared for the respondent.

To Read the full text of the Order CLICK HERE

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