Tribunal grants interest on delayed refund; disclaimer rejected. Appellant entitled to Section 27(A) interest.

The Tribunal allowed the appeal, holding that the appellant is entitled to interest on delayed refund sanction under Section 27(A) of the Customs Act if the refund is sanctioned beyond three months. The Tribunal rejected the argument based on the appellant's disclaimer of interest, emphasizing that such disclaimer lacks legal basis. The case was remanded to the original adjudicating authority for reevaluation of the interest claim, with directions to consider the Tribunal's findings and provide a reasonable opportunity to the appellant.

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Issues:
Appeal against Order-in-Appeal regarding refund claim and interest on delayed sanction.

Analysis:
The case involves the appellant importing goods and paying duty as per initial assessment. Subsequently, a re-assessment was done, and the appellant filed refund claims due to the difference in duty. The refund was sanctioned after a delay of nearly two years without interest. The appellant then appealed for interest on delayed refund sanction. The Commissioner (Appeals) rejected the appeal citing the appellant's earlier disclaimer of interest. However, the Tribunal noted that there is no statutory provision for disclaiming interest on refund. Section 27(A) of the Customs Act entitles the appellant to interest if the refund is sanctioned beyond three months, which was the case here. The Tribunal held that the appellant is entitled to interest on the delayed refund.

The Additional Commissioner argued that the appellant's disclaimer of interest and subsequent withdrawal, along with deficiencies in the refund claim, justified the rejection of interest. However, the Tribunal found that the disclaimer had no legal basis as per the Customs Act. The Tribunal also highlighted that the deficiency in documents was not adequately addressed by the lower authority. Despite any document-related issues, the delay in refund sanction alone entitled the appellant to interest. Citing a Supreme Court case, the Tribunal emphasized that interest must be paid in cases of delayed refund sanction beyond three months.

Consequently, the Tribunal allowed the appeal by remanding the matter to the original adjudicating authority. The authority was directed to reevaluate the interest claim, considering the Tribunal's observations and providing a reasonable opportunity to the appellant. The judgment emphasized the appellant's entitlement to interest on the delayed refund sanction as per Section 27(A) of the Customs Act.

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