CA Final · Indirect Tax Laws · Refund
Mehta Pharma imported a consignment of a chemical and paid duty. The goods were found defective and otherwise satisfied the Section 26A conditions, but the chemical had exceeded its recommended storage-before-use period when Mehta decided to export it. Mehta had not claimed drawback. What is the position under Section 26A?
No refund is allowed. Section 26A(3) prohibits refund under sub-section (1) for perishable goods and goods that have exceeded their shelf life or recommended storage-before-use period, whatever the mode of disposal chosen, and an extension of time cannot cure this bar.
- ARefund is allowed if the goods are exported within thirty days
- BRefund is allowed only if the goods are destroyed in the presence of the proper officer
- CRefund is allowed if the Commissioner extends the period by three months
- DRefund under sub-section (1) is not allowed for goods that have exceeded their shelf life or recommended storage-before-use periodCorrect
Explanation
Section 26A(3) bars refund under sub-section (1) for perishable goods and goods that have exceeded shelf life or recommended storage-before-use period. This bar applies regardless of the mode of disposal (export, abandonment or destruction). The extension of time by the Commissioner only relates to the thirty-day period and cannot override this bar.
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