Refund interest under Customs law runs from three months after original claim filing, not later clarification submissions.

Interest on customs duty refunds under Section 27A of the Customs Act, 1962 runs from the expiry of three months after receipt of the refund application, where the claim is not disposed of within that period. If the original application was acknowledged and not duly returned as deficient in accordance with law, later clarifications or supporting documents do not shift the start date for interest. The Department could not defer interest by treating the later resubmission date as the effective date of the claim, so interest was payable from three months after the original refund filing.

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Issues: Whether interest on the refunded customs duty was payable from three months after the original refund applications were filed, or only from a later date when supporting documents and clarifications were finally furnished.

Analysis: The refund applications had been filed in 2004 and were acknowledged by the Department. The applications were kept pending for years and were not returned within the statutory time in the manner contemplated for a deficient application. Section 27A of the Customs Act, 1962 mandates payment of interest where refund is not granted within three months from the date of receipt of the application, and the Department could not defer the commencement of interest by treating later clarifications or resubmissions as the effective date of the claim when the original applications had already been received.

Conclusion: Interest was payable from three months after 02.06.2004, the date of filing of the refund applications, and not from 20.12.2017.

Final Conclusion: The assessee succeeded in obtaining interest on the refunded amount for the full statutory period commencing three months after the original refund claims were filed.

Ratio Decidendi: Under Section 27A of the Customs Act, 1962, interest on refund runs from the expiry of three months after receipt of the refund application where the claim is not disposed of within that period, unless the application is duly returned as deficient in accordance with law.

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