High Court held that u/s 18 amount had to be refunded immediately

1. Sayonara Exports imported RDB Palmolein (edible grade) and paid extra duty deposit as provisional assessment, pending survey report.

2. On submission of the report, the Department finalised the provisional assessment and forwarded the file to the Refund Section for refund of the EDD.

3. Assistant Commissioner of Customs (Refund) held that no refund application had been filed as required under Explanation II to s 27 and the refund application should have been filed within six months from the date of finalisation of provisional assessment.

4. He rejected the claim.

5. Commissioner (Appeals) allowed the appeal.

6. Tribunal upheld the Commissioner’s order.

7 .On Revenue’s appeal, the High Court held as under:

8. As far as Section 18 of the Act is concerned, when an amount becomes refundable after a final order is passed, the same has to be refunded immediately and for this purpose the assessee is not required to move an application under Section 27 and accordingly sub-section (2) to Section 27 would not apply.

9. In view of the fact that the entire case of claim for refund arose earlier to the amendment and the first situation envisaged in para-104 of the judgment of the Supreme Court in Mafatlal Industries case (supra) apply on all fours to the case on hand.

10. Accordingly, substantial question of law Nos.1, 2 and 4 are answered in favour of the assessee and against the appellant/Revenue.

Case Reference -Commissioner Of Customs (Exports) vs M/S.Sayonara Exports Pvt. Ltd & Anr

Madras High Court