REIMPORT OF EXPORTED GOODS

[Rakesh Gupta]

Goods exported from India to Canada under RODTEP & IGST.

Part of the goods returned back within 20 months as goods were defective.

Filed for import clearance under notification 045/2017, serial no. 1A.

RODTEP & IGST claimed at time of export paid back to customs, as detailed under ntfn 045/17.

Customs is insisting upon payment of interest on RODTEP & IGST refunded, although the notification does not ask for interest, only for refund of drawback, RODTEP, IGST claimed at the time of export.

Please advise.

AI Summary

Interest on refunded IGST and export incentives may attach when refunded amounts are repaid on reimportation of exported goods.
When exported goods are reimported after the exporter received refunds or export incentives, customs require repayment of drawback, incentives and IGST; revenue authorities assert statutory interest on amounts erroneously refunded or retained as public money, while practitioners argue that IGST is tax-neutral on genuine exports and that notifications allowing reimportation do not expressly waive statutory interest, leaving a legal question whether general interest provisions apply despite silence in the notification.