Payment Of Interest On Delayed Payment Of Refund Amount U/S 27A Customs Act Is A Statutory Entitlement: Bombay HC

In the present case, Petitioner, Ajay Industrial Corporation Ltd. approached the Commissioner of Customs after the adjudicating authority refused their claim of refunds. The Customs Commissioner allowed their appeal and remanded the case back to the adjudicating authority. The Adjudicating Authority granted their claim of refund however, in this Writ Petition, it is the case of Petitioner that adjudicating authority failed to grant interest on delayed payment of interest and they are entitled to get it under Section 27A.

The division bench noted that although a specific prayer was made before the Commissioner of Appeals and the proceedings were remanded in that regard, the Designated Officer failed to consider such prayers of interest on delayed payment.

The Court stated that even assuming that the petitioner had not made a prayer for interest, the fact that it would be a statutory entitlement of the Petitioner to seek the interest on the refund amounts when such applications were allowed.

The High Court directed the Adjudicating Officer to decide the interest claim of the Petitioner on the Refund Applications, after granting to the Petitioner an opportunity of a hearing on the quantum.

The Court further directed the Adjudicating Officer to call the Petitioner for a hearing by issuing seven days’ notice, so that all the documents whatever necessary can be presented before the Adjudicating Officer to enable him to pass an appropriate order granting a refund to the Petitioner.

Accordingly, the Court disposed of the Writ Petition.

Cause Title: M/s. Ajay Industrial Corporation Ltd. v. The Assistant Commissioner of Customs (Neutral Citation: 2024:BHC-AS:13602-DB)

Appearance:

Appellant: Adv. Mr. Rajiv Jaipal, Adv. Francis Fernandes

Respondent: Adv. Jaymala Ostwal, Adv. Mamta R. Omle

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