Refund interest limited to duty component, not fine or penalty, where the underlying dispute was resolved in favour of the depositor.

Interest on refund was confined to the duty component where duty, fine and penalty had been deposited under protest and the refund later became due in the depositor's favour. The Court held that the interest entitlement did not extend to amounts paid as fine or penalty, because the refund liability arose only in relation to the duty amount. Accordingly, interest at 12% was payable only on the duty amount and not on the fine and penalty.

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Issues: Whether interest on the refunded amount was payable only on the duty component or also on fine and penalty.

Analysis: The respondents had deposited duty, fine and penalty under protest. The dispute later stood resolved in their favour and refund became payable. The only surviving question was the extent of interest on the refund, specifically whether it could extend beyond the duty component to include fine and penalty.

Conclusion: Interest at 12% was payable only on the duty amount and not on fine and penalty.

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