C.C., ICD Vs. NAGESH HOSIERY EXPORT LTD.

JUDGEMENT

(1.) THIS appeal is filed by the Revenue against the Order -in Appeal dated 14.10.2004 wherein interest was awarded to the respondents on their refund claim after 3 months from the date of filing of refund claim.

(2.) RELEVANT facts that arise for consideration are that the respondents filed refund claim for Rs. 2,79,129/ - on 10.4.1989 on account of payment of excess duty. The appellants imported secondhand machinery and sought benefit of notification No. 21/88 -Cus dated 1.3.88 which granted exemption from payment of customs duty which is in excess of 35% of the value. However, the department did not allow the benefit of notification and machineries were assessed at 45% Advalorem. The respondents paid the duty as assessed and filed an appeal against the assessment. The Commissioner (Appeals) allowed the appeal filed by the respondents and accordingly the respondents were eligible for the refund of the excess duty paid by them. The respondents were refunded the amount of duty excess paid by them on 9.6.2004 after considerable litigation but no interest was sanctioned to them. The respondents' claim was rejected by the adjudicating authority, and the Commissioner (Appeals) in the above said order allowed the appeal of the respondents and directed the lower minorities to refund the amount of excess duty along with interest a her expiry of 3 months from 10.4.1989 as per the provisions of Section 27A of the Customs Act, 1962. Hence this appeal.

(3.) LEARNED D.R. submits that the Order of the Commissioner (Appeals) is flawed to the extent that he has directed the department to pay the interest from 9.7.89 till 9.6.2004 under Section 27A of the Customs Act, 1962 inasmuch as that the said provision of Section 27A came into existence from 26.8.1995 and interest under Section 27A at the most came to apply from 26.8.95 i.e. 3 months after the enactment of the provisions. He relies upon the decision of the Hon'ble High Court of Rajasthan in the case of J.K. Cement v. A.C.C., and E.G. reported at .