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The issue involved in this case is the refund of extra customs duty paid by the respondent, which was rejected by the Customs authorities due to an application made after the stipulated time under S. 27 of the Customs Act, 1962. Refund of Extra Customs Duty: The respondent paid the duty at the rate that originally prevailed, without noticing the change in the tariff rate effected by a notification issued before the date on which the Bill of Entry was submitted. The respondent's application for refund was rejected by the Customs authorities as it was made after the time stipulated under S. 27 of the Customs Act. The High Court, in allowing the writ petition for refund, emphasized that the duty levied was without the authority of law, as per Art. 265 of the Constitution which states, "No tax shall be levied or collected except by authority of law." The Court held that since the duty imposed was without legal authority, there was no jurisdiction to impose or collect the tax, and therefore, the provisions of the Constitution must prevail. Jurisdiction under Art. 226 of the Constitution: The Court considered the decision of the Supreme Court in Madras Rubber Factory v. Union of India, where it was upheld that the Supreme Court could only decide whether the authority functioning under the Act had acted in accordance with the law. The Court noted that no Supreme Court decision was brought to their notice where jurisdiction under Art. 226 of the Constitution was refused in an application for refund of tax collected without the authority of law. In light of this, the High Court dismissed the appeal, stating that they have chosen to write a speaking order due to the extensive arguments presented, indicating that the matter may not end with this decision.
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