CA Final · Indirect Tax Laws · Refund
Aarav Exports Pvt Ltd of Surat exported machine parts and paid export duty on them. The goods were returned to Aarav, not by way of re-sale, and were re-imported 10 months after the date of exportation. Aarav applied for refund of the export duty within six months of the proper officer's order for clearance of the re-imported goods. Which statement is correct under Section 26 of the Customs Act, 1962?
Refund is admissible. Section 26 requires return of the goods otherwise than by re-sale, re-importation within one year of exportation, and application within six months of the clearance order. Ten months is within one year and the application was timely, so every condition is met.
- ARefund is not admissible because the goods were re-imported after more than one year from exportation
- BRefund is not admissible because the goods must be re-imported within six months of exportation
- CRefund is admissible because all three conditions of Section 26 are satisfiedCorrect
- DRefund is admissible only if the goods were re-sold to the original buyer
Explanation
Section 26 requires: goods returned to the person otherwise than by re-sale, re-importation within one year of exportation, and an application within six months from the proper officer's order for clearance. Re-importation after 10 months is within one year and the application is timely. The option citing six months confuses the application period with the re-import period.
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