Skip to content

CA Final · Indirect Tax Laws · Levy of and Exemptions from Customs Duty

For years, importers of a certain chemical at Mundra port paid no duty because of a generally prevalent practice, though the goods were in fact dutiable. Nimbus Chem Ltd paid Rs 6,00,000 duty at another port on the same goods. The Central Government notified under section 28A(1) that the duty not levied under the practice need not be paid. The notification was issued on 10 June. Which statement is correct about Nimbus Chem's refund?

Nimbus Chem can claim the refund by applying to the Assistant or Deputy Commissioner of Customs, in the form under section 27(1), before six months from the notification date of 10 June. The refund is dealt with under section 27(2), as section 28A(2) provides.

  1. AIt can claim the refund on application to the Assistant or Deputy Commissioner in the form under section 27(1) before six months from 10 June, dealt with per section 27(2)Correct
  2. BIt can claim the refund at any time within one year of the import
  3. CIt cannot claim any refund because the notification applies only to duty not yet paid
  4. DIt gets an automatic refund without application

Explanation

Section 28A(2) says duty paid which would not have been paid had the notification been in force is dealt with under section 27(2). The proviso requires an application in the form under section 27(1) to the Assistant or Deputy Commissioner before the expiry of six months from the notification date. A one-year period or automatic refund is not provided.

Did you get it right without looking?

One question tells you little. A timed set on Levy of and Exemptions from Customs Duty shows your real accuracy, how long you take and where you lose marks.

Practise Levy of and Exemptions from Customs DutyFree diagnostic mock

More Levy of and Exemptions from Customs Duty questions