2017 (2) TMI 818 - AT - Customs

Interest u/s 27A of the CA, 1962 - petitioner claim that since the assessment was provisional, there cannot be a claim of interest u/s 27A of the CA, 1962, as it pertains to the period far prior to 2006 - both the authorities below proceeded on the basis that the assessment was provisional and therefore the amended section 18 in 2006 could be attracted - Held that - it is not clear as to whether the refund claim is arising out of the provisional assessment or not. It appears from the submission of the ld.Advocate that the refund claim was filed as the benefit of exemption Notification was not claimed by the appellant. Thus, there is no clarity in the facts and findings of the case - In my considered view, it should be decided as to whether the refund claim is arising out of the provisional assessment or not and thereafter, the claim of interest could be decided under the provisions of Customs Act, 1962 - appeal allowed by way of remand.

Summary

Issues:
Claim of interest on delayed refund of customs duty; Provisional assessment under Customs Act, 1962; Applicability of Section 27A of the Customs Act, 1962; Denial of benefit of exemption Notification No.236/89/Cus; Refund arising from provisional assessment.

Analysis:
The appellant appealed against an order denying interest on delayed refund of customs duty, citing that the claim was filed in 2009 for refunds from 1992 and 1993, sanctioned in 2008. The appellant argued that Section 27A of the Customs Act, 1962 entitles them to interest post-1995. The Tribunal noted multiple rejections based on unjust enrichment until 2008 when the issue was settled in favor of the appellant. However, the Deputy Commissioner rejected the interest claim citing provisional assessment under Section 18, amended in 2006.

The Tribunal observed that the lower authorities assumed provisional assessment, but clarity was lacking on whether the refund claim stemmed from it. The appellant contended that denial of duty exemption led to the refund claim. The Tribunal remanded the matter for fresh adjudication, emphasizing the need to determine if the claim arose from provisional assessment before deciding on interest under the Customs Act, 1962.

The Tribunal highlighted the importance of clarity in facts and findings, directing a reevaluation by the Adjudicating Authority. The decision to set aside the impugned orders and remand the case aimed to ensure a fair assessment based on the observations made. Both parties were granted the opportunity to present evidence, keeping all issues open for further consideration.

In conclusion, the Tribunal allowed the appeal by remanding the case for a thorough reassessment, emphasizing the necessity to establish the origin of the refund claim before addressing the interest entitlement under the Customs Act, 1962. The judgment focused on ensuring a just and informed decision by the Adjudicating Authority, with provisions for a fair hearing and evidentiary submissions from both parties.