Delayed customs refund attracts statutory interest when no deficiency is communicated and the application is treated as complete.

Interest on delayed customs refund under section 27A accrues from the date a complete refund application, acknowledged by the proper officer, is made. Where no deficiency was communicated to the applicant, the application could not be treated as incomplete merely because original documents were later said to be missing. Regulation 23 required a deficient application to be returned within ten days for rectification, and that procedure was not followed. As the refund was not made within three months, statutory interest became payable on the refunded amount.

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Issues: Whether the appellant was entitled to interest on delayed refund of customs duty under section 27A when the refund application was said to be incomplete for want of original documents.

Analysis: The refund arose from the allowance of the valuation appeal, and the application for refund was filed on 27 July 2009. The objection that the application was incomplete was not supported by any deficiency being notified to the applicant. Under the Explanation to Rule 2 of the Customs Refund Application (Form) Regulation, 1995, interest under section 27A runs from the date a complete application, acknowledged by the proper officer, is made. Regulation 23 required return of a deficient application within ten days so that defects could be cured, but no such course was adopted. In the absence of any communicated deficiency, the application had to be treated as complete, and failure to refund within three months attracted statutory interest.

Conclusion: The appellant was entitled to interest on the refunded amount under section 27A of the Customs Act.

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