2009 (1) TMI 229 - HC - Customs

Interest on Delayed Refund - The goods were kept in a warehouse and ex-bond bilk of entry was filed on 10-4-1982. On 15-4-1982 it was found by the appellant that the imported goods were in damaged condition - on 22-4-1982 the appellant deposited customs duty with interest under protest - later Accordingly a refund of Rs. 3, 16, 777/- has been allowed instead of Rs. 4, 71, 120/ - appellant demanded interest on delayed refund - held that - the prayer of the appellant accepted to the extent that simple interest be awarded @ 10% per annum from the date of order i.e. 6-2-1996 to the actual date of refund i.e. 23-11-1998.

Summary

Issues:
1. Market price determination by surveyor - cum-duty or not
2. Entitlement to interest on delayed duty refund
3. Violation of natural justice by the Tribunal

Analysis:
Issue 1: Market Price Determination
The appellant imported equipment which was found damaged, leading to a survey for abatement of duty. The survey report assessed the value of goods at Rs. 3.5 lacs. The appellant deposited customs duty and interest under protest. Various refund claims were made and rejected, leading to multiple appeals. The Tribunal directed refund based on the surveyor's assessment. The Assistant Commissioner rejected the claim, stating the correct refund was given, and interest was not due. The Commissioner (Appeals) held the surveyor's assessment did not include customs duty. The Tribunal rejected the appeal, leading to the current challenge.

Issue 2: Entitlement to Interest
The appellant sought interest on delayed refund from 6-2-1996 to 23-11-1998. The appellant relied on a Supreme Court judgment for this claim. The respondents cited an amendment in the Act and reasons for denying interest. The High Court found in favor of the appellant, awarding simple interest at 10% per annum from 6-2-1996 to 23-11-1998, following the Supreme Court precedent.

Issue 3: Violation of Natural Justice
The appellant raised concerns about the Tribunal's order violating the principle of natural justice. However, the High Court's judgment focused on the interest aspect and did not delve into this issue in detail. The High Court granted the interest as per the appellant's request based on the Supreme Court's decision, concluding the appeal in favor of the appellant.