CA Final · Indirect Tax Laws · Levy of and Exemptions from Customs Duty
For years, importers of a chemical at Mundra paid no duty because of a generally prevalent practice, though the chemical was actually dutiable. The Central Government, satisfied about the practice, issues a notification under section 28A(1) that duty not levied under the practice need not be paid. Vishwas Traders had earlier paid the duty on its consignments, and the notification was issued on 10 March. Which course is correct for Vishwas Traders under section 28A(2)?
Vishwas Traders may get a refund, dealt with under section 27(2), but only if it applies in the prescribed form to the Assistant or Deputy Commissioner of Customs within six months of the notification date, here 10 March. Refund is not automatic.
- ANo refund is possible because duty once paid cannot be recovered
- BIt can claim refund under section 27(2) provisions if it applies to the Assistant or Deputy Commissioner in the prescribed form within six months of 10 MarchCorrect
- CIt can claim refund at any time within one year of payment of duty
- DIt automatically receives refund without any application
Explanation
Section 28A(2) says duty paid that would not have been payable had the notification been in force is dealt with under section 27(2). The proviso requires an application, in the form referred to in section 27(1), to the Assistant or Deputy Commissioner before six months from the date of issue of the notification expire. Hence refund needs a timely application; it is neither automatic nor barred.
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