TaxTMI 
TaxTMI 
2024 (10) TMI 734
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....lication by order in the original dated 17 February 2017. Aggrieved, the petitioner appealed to the Commissioner (Appeals) vide Appeal No. 403 of 2017. 5. The Commissioner (Appeals) allowed the petitioner's appeal, set aside the order dated 17 February 2017 and remanded the matter to the respondent to consider again the petitioner's representation/application dated 04 August 2014. The respondent, by yet another order in original dated 16 October 2020, once again rejected the petitioner's claim for refund. The petitioner, once again, appealed to the Commissioner (Appeals) vide Appeal No. 1858 of 2020. 6. The Commissioner (Appeals) vide order dated 30 June 2022, once again allowed the petitioner's appeal, set aside the original order dated 16 October 2020 and remanded the matter to the respondent to consider the petitioner's refund application. 7. Despite the above, the respondent kept delaying disposing of the petitioner's refund application dated 04 August 2014. This forced the petitioner to file a grievance/complaint dated 15 September 2023 on the CPGRAMS portal. In response, the respondent called up the petitioner's counsel and admitted having misplaced....
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....s section from the date immediately after three months from such date, till the date of refund of such duty. Explanation.-Where any order of refund is made by the Commissioner (Appeals), Appellate Tribunal, National Tax Tribunal or any court against an order of the Assistant Commissioner of Customs or Deputy Commissioner of Customs under sub-section (2) of section 27, the order passed by the Commissioner (Appeals), Appellate Tribunal, National Tax Tribunal Tribunal or as the case may be, by the court shall be deemed to be an order passed under that sub-section for the purposes of this section." 11. The Central Government issued a notification in the official gazette specifying a rate of 6% per annum as the interest rate on delayed refunds. Accordingly, the petitioner has reached the figure of Rs. 4,21,940/- as payable to it towards interest on the delayed refund. 12. The respondent has not disputed the calculation, but learned counsel for the respondent referred to the communication dated 07 October 2024 addressed by the Assistant Commissioner of the Customs to the senior standing counsel in the case of M/s Ajay Industries Corporation Ltd. (petitioner herein) referring to Sec....
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.... of 6% per annum, Section 27A of the customs act notwithstanding. 17. The respondent's contention about the petitioner's case being covered by the explanation to Section 27A is untenable. This is not a case of an order of refund made by the Commissioner (Appeals). The Commissioner (Appeals) only remanded the matter to the respondent, who ultimately ordered the refund. Assuming we were to accept the respondent's contention, the first part of section 27A provides for the order by which the refund arose. Still, the period for calculating interest provided in the later part of the section states that the starting point is the date of application. Therefore, even on this count, no relief could be denied to the Petitioner. Thus, the explanation to Section 27A of the Customs Act does not apply and based upon a distorted interpretation of the same, the respondent cannot avoid payment of interest at the rate of 6% per annum from 04 September 2014. 18. There is, and there can be, no dispute that the petitioner filed an application claiming a refund of SAD in the amount of Rs. 7,40,458/- on 04 August 2014. The respondent never claimed that this application was incomplete or had any defi....
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....ting officer in considering refund application on remand. This order further holds, "Even assuming the petitioner had not made a prayer for interest, however, the fact remains that it would be statuary entitlement of the petitioner to seek the interest on the refund amount when such applications were allowed". Accordingly, directions were issued to the respondent to decide the claims for refund and interest on the refundable amount. 22. Thus, in this case, we are satisfied that the respondent has delayed granting the refund that was due and payable to the petitioner for almost ten years. Now, the respondent is avoiding the payment of interest on the delayed refund amounts by raising frivolous pleas even though the interest component comes to hardly Rs. 4,21,940/-as of the date of institution of the petition. 23. In the context of Sections 11B and 11BB of the Central Excise Act, the Hon'ble Supreme Court, in the case of Union of India Vs. Hamdard (Waqf) Laboratories AIR 2016 SC 1124 has considered and rejected similar arguments made on behalf of the Revenue. Hon'ble Supreme Court held the liability for the interest payment is statutory, and it is the bounden duty of the Assistant ....
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....ermined. 26. The Madras High Court noted that the adjudicating authority imposes interest and penalty on such duty liability when adjudicating the liability. It is not that such duty alone is collected from the importer from the date of adjudication. On the other hand, such liability to pay duty is fastened on such importer from when it becomes due. Therefore, the revenue collects the interest on such overdue duty payments and the penalty for not paying them at the appropriate time. The same analogy is to be applied in the case of a refund while considering the interest payment. That is why Section 27A of the Customs Act was carefully coined for payment of such interest from the expiry of three months from the date of the application and not from the date of the order. 27. Mr Adik relied upon the decision of the CESTAT, West Zonal Bench, Mumbai in the case of Commissioner of Customs & GST, Mumbai West Vs. Juhu Beach Resort Ltd. 2020 (371) E.L.T. 622 (Tri. - Mumbai) and the decision of Regional Bench in the case of Commissioner of Customs, Mumbai Import-II Vs. Forever Living Imports (India) Pvt. Ltd. Customs Stay Application No. 85222 of 2020 in Customs Appeal No. 85583 of 2020 de....