CA Final · Indirect Tax Laws · Refund
Sundaram Exports Ltd shipped machine parts and paid export duty at the time of exportation. The buyer in Dubai rejected the consignment, and the same goods came back to Sundaram, which did not re-sell them. The goods were re-imported 10 months after exportation. The proper officer had made the order for clearance of the goods for export on 1 March. Under the Customs Act, 1962, which of the following is a necessary condition for refund of the export duty paid?
Export duty is refunded only if the goods are re-imported within one year from the date of exportation, are returned otherwise than by re-sale, and the refund application is made within six months of the proper officer's order for clearance.
- AThe goods must be re-imported within one year from the date of exportationCorrect
- BThe goods must be re-imported within six months from the date of exportation
- CThe goods must be re-sold to another buyer in India after re-import
- DThe refund application must be made within one year of re-import
Explanation
Section 26 allows refund of export duty if the goods are returned to the person otherwise than by way of re-sale, are re-imported within one year from exportation, and the application is made within six months from the date of the order for clearance. Re-import at 10 months satisfies the one-year test. A six-month re-import limit is confused with the application period, and re-sale is expressly excluded.
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