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Issues: Refund of penalty amount under Customs Act, delay in refund, entitlement to interest on delayed refund.
Analysis: The petitioners, who are shipping agents of a foreign company, were directed to pay a penalty of Rs. 3,93,777 under Section 116 of the Customs Act for short landing of goods. Upon revision, the penalty was set aside, and the Collector ordered a refund of Rs. 3,97,777 to the petitioners. However, only Rs. 3,26,477 was refunded after adjustments for other liabilities. Despite repeated requests, the Collector did not refund the remaining amount, leading the petitioners to file a petition under Article 226 of the Constitution of India in the High Court. The Court noted that the petitioners had received Rs. 3,25,000 but were still owed Rs. 1,477. The petitioners requested interest on the entire amount from November 29, 1985, onwards. The Court found the Collector's delay in refunding the amount unjustified and held that interest should be paid on the delayed refund. The respondents' argument that the delay was due to pending proceedings before the Government of India was dismissed as no evidence or affidavit was presented to support this claim. Consequently, the Court directed the respondents to refund the outstanding amount of Rs. 1,477 to the petitioners within four weeks. Additionally, the respondents were ordered to pay interest at a rate of 15% per annum on the refunded amount of Rs. 3,25,000 from November 29, 1985, to November 22, 1988, when the amount was deposited in Court. Interest at the same rate was also to be paid on the balance amount of Rs. 1,477 from November 29, 1985, until the date of payment. The respondents were further instructed to bear the costs of the petitioners.
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