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TMI Blog2013 (6) TMI 148X X X X Extracts X X X X X X X X Extracts X X X X ..... state that no interest on delayed payment is contemplated in the notification issued under Section 25 of the Customs Act, 1962 is a misconception of the provisions of the Customs Act, 1962. When Section 27 of the Customs Act, 1962 provides for refund of duty and Section 27A of the Customs Act, 1962 provides for interest on delayed refunds, the authority cannot override the said provisions by a circular and deny the right which is granted by the provisions of the Customs Act, 1962 and Customs Tariff Act, 1975. Therefore, paragraph 4.3 of the Circular No.6/2008-Customs, dated 28.4.2008 is contrary to the statute and becomes totally inappropriate. When the circular is contrary to the provisions of the Customs Act, 1962 and Customs Tariff Act, 1975, it has to be struck down as bad. - Decided in favor of assessee. - W.P.No.959 of 2013 - - - Dated:- 21-1-2013 - R. Sudhakar,JJ. For the Petitioner : Mr. P. H. Arvindh Pandian Senior Counsel for M/s. R. Hemalatha For the Respondents : Mr. Haja Mohideen Gisthi ORDER This writ petition is filed seeking issuance of a writ of Certiorarified Mandamus to call for the records of the Circular No.6/2008-Customs, dated 28.4. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nvoice that in respect of the goods covered therein, no credit of the additional duty of customs levied under sub-section (5) of section 3 of the Customs Tariff Act, 1975 shall be admissible; (c) the importer shall file a claim for refund of the said additional duty of customs paid on the imported goods with the jurisdictional customs officer; (d) the importer shall pay on sale of the said goods, appropriate sales tax or value added tax, as the case may be; (e) the importer shall, inter alia, provide copies of the following documents alongwith the refund claim: (i) document evidencing payment of the said additional duty; (ii) invoices of sale of the imported goods in respect of which refund of the said additional duty is claimed; (iii) documents evidencing payment of appropriate sales tax or value added tax, as the case may be, by the importer, on sale of such imported goods. 3. The jurisdictional customs officer shall sanction the refund on satisfying himself that the conditions referred to in para 2 above, are fulfilled." 3. Admittedly, the petitioner has paid the special additional duty and sought for refund of the same under Section 27 of the Customs Act, 1962 a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nterest being made applicable under the said notification, the payment of interest does not arise for these claims. However, Board directs that the field formations shall ensure disposal of all such refund claims under the said notification within the normal period not exceeding three months from the date of receipt." 5. By the said circular, the Central Board of Excise and Customs, taking note of the large number of refund applications, has come to hold that since there is no specific provision for payment of interest made applicable under the Notification No.102/2007-Customs, dated 14.9.2007, payment of interest does not arise for these claims. The Board, however, hastened to add that the applications for refund should be disposed of promptly. It is this portion of the circular by which interest on delayed refund is denied that affects the right of the petitioner and, therefore, they are before this Court challenging paragraph 4.3 of Circular. 6.1. Mr. P. H. Arvind Pandian, learned Senior Counsel appearing for the petitioner contended that refund of duty or interest should be made within one year from the date of payment of such duty or interest and that has been made but the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on, the present circular denies the payment of interest on the refund claim made stating that the exemption notification under Section 25(1) of the Customs Act, 1962 does not provide for payment of interest. 6.3. He further contends that the grant of exemption under Section 25 of the Customs Act, 1962 is independent of payment of refund under Section 27 of the Customs Act, 1962 and the payment of interest for delay under Section 27A of the Customs Act, 1962. Both cannot be clubbed together. The Circular No.6/2008-Customs, dated 28.4.2008 is based on a misconception of the above provision of law. 7.1. Mr. Haja Mohideen Gisthi, learned Central Government Standing Counsel appearing for the respondents contends that the notification under Section 25(1) of the Customs Act, 1962 provides for exemption from payment of special additional duty by following certain procedure. However, there is no provision for payment of interest on refund and, therefore, the petitioner cannot seek interest on the delayed refund either. 7.2. He further contended that the payment of special additional duty and refund consequent to exemption granted under Section 25(1) of the Customs Act, 1962 is a speci ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ent States or, if a like alcoholic liquor is not produced or manufactured in any State, then, having regard to the excise duty which would be leviable for the time being in different States on the class or description of alcoholic liquor to which such imported alcoholic liquor belongs. Explanation. In this sub-section, the expression the excise duty for the time being leviable on a like article if produced or manufactured in India means the excise duty for the time being in force which would be leviable on a like article if produced or manufactured in India or, if a like article is not so produced or manufactured, which would be leviable on the class or description of articles to which the imported article belongs, and where such duty is leviable at different rates, the highest duty. .... (5) If the Central Government is satisfied that it is necessary in the public interest to levy on any imported article [whether on such article duty is leviable under sub-section (1) or, as the case may be, sub-section (3) or not] such additional duty as would counter-balance the sales tax, value added tax, local tax or any other charges for the time being leviable on a like article on its s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... efore, the provision that is applicable for refund is Section 27 of the Customs Act, 1962. If the refund is not made as specified, then the consequences will follow with regard to interest. 11. Furthermore, the grant of exemption under Section 25(1) of the Customs Act, 1962 is an independent exercise of power by the Central Government and certain conditions have been imposed in the said notification for seeking refund, but the procedure for refund, as has already been highlighted, will fall under Section 27 of the Customs Act, 1962 as made applicable under Section 3(8) of the Customs Tariff Act, 1975. A conjoint reading of these two provisions makes it clear that the refund application should be filed and entertained only under Section 27 of the Customs Act, 1962 and there is no method or manner prescribed under Section 25 of the Customs Act, 1962 to file an application for refund of duty or interest. To state that no interest on delayed payment is contemplated in the notification issued under Section 25 of the Customs Act, 1962 is a misconception of the provisions of the Customs Act, 1962. 12. When Section 27 of the Customs Act, 1962 provides for refund of duty and Section 27A ..... X X X X Extracts X X X X X X X X Extracts X X X X
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