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CA Final · Indirect Tax Laws · Refund

Kaveri Traders imported machine parts and paid import duty on clearance for home consumption. The order for clearance under section 47 was made on 10 June. The parts were found not in conformity with the agreed specifications, were not used, and are easily identifiable. Kaveri did not claim drawback. Kaveri wants to destroy the goods in the presence of the proper officer. Under section 26A of the Customs Act, 1962, what is the time limit for completing the destruction without any extension?

The goods must be destroyed within thirty days from the date of the section 47 order for clearance for home consumption. The Principal Commissioner or Commissioner may extend this for up to three months on sufficient cause. The six-month period relates only to filing the refund application.

  1. AWithin thirty days from the date of the order for clearance under section 47Correct
  2. BWithin six months from the date of the order for clearance under section 47
  3. CWithin thirty days from the date of the refund application
  4. DWithin three months from the date of payment of duty

Explanation

Section 26A(1)(d) requires export, abandonment or destruction within a period not exceeding thirty days from the date of the section 47 clearance order. The period can be extended on sufficient cause by the Principal Commissioner or Commissioner for up to three months. Six months is the time limit for filing the refund application from the relevant date, not for destruction, so option B is wrong. The other options use incorrect starting points.

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