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2016 (9) TMI 881 - BOMBAY HIGH COURTInterest on refund under the provisions of Section 27A of the Customs Act, 1962 - import of spares and consumables for carrying out drilling operations - Notification No.21/2002-Cus dated 1st March, 2002 - exemption of goods required in connection with petroleum operations undertaken under petroleum exploration licenses - sub-contractor - Essentiality Certificate - import without claiming benefit and on payment of duty - claim for refund - is applicant entitled to get interest on delayed refund? - Held that: - once an application for refund has been made and the same is granted within a period of three months from the date of receipt of the application, then there would be no liability to pay interest to the applicant. However, if the refund is granted beyond the period of three months from the date of receipt of the application, then, on the amount of refund granted, interest would also be payable from the date immediately after expiry of three months from the date of receipt of such application, till the date of refund. the decision in the case Ranbaxy Laboratories Ltd Vs. Union of India [2011 (10) TMI 16 - Supreme Court of India] would apply. The Petitioner had not complied with the conditions of the Essentiality Certificate. It therefore held that the Essentiality Certificate could not be taken to be the basis of the refund and accordingly rejected the refund application of the Petitioner. This order dated 13th December, 2011 was thereafter subjected to an appeal and as well as further proceedings , which finally culminated in a refund being granted to the Petitioner on 23rd June, 2014 in the sum of ₹ 1,89,15,549/-. As no interest was granted on this refund, the Petitioner challenged the said order - Held that: - the statutory provisions are clear that where there is a delay in the grant of refund, then interest must follow. It is only the calculation thereof which would be determined by the Authority - applicant entitled to interest. Necessary action to be taken against the Secretary, Ministry of Finance (Department of Revenue), Government of India and the Chairman, Central Board of Excise and Customs, New Delhi. It is only they who would possibly realise that the object and purpose is to take expeditious action on refund applications so that revenue loss is avoided in payment of statutory interest. The intent is to discourage the tendency of not taking prompt action on these applications, thereby defeating all policies aimed at creating a business friendly atmosphere. They must also realise that litigation in Court on this score results in precious time and money being wasted. Applicant entitled to interest on delayed refund - matter on remand to Refunding Authority for the limited purpose of calculating and paying interest - petition disposed off - decided in favor of petitioner.
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