Limitation period for granting refund not applicable to refund of Custom duty paid in excess

Last updated: 05 December 2021

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Quick Summary

The Customs, Excise & Services Tax Appellate Tribunal (CESTAT) has ruled that the usual time limit for claiming refunds does not apply when customs duty has been paid in excess. This decision was made in a case where a company claimed a refund of service tax paid on ocean freight, which was later deemed unconstitutional by the Gujarat High Court. CESTAT clarified that tax paid under a mistake of law, due to an unconstitutional levy, should be refunded without the restriction of Section 27 of the Customs Act.

Court :
CESTAT, Bangalore

Brief :
The Hon'ble Customs, Excise & Services Tax Appellate Tribunal, Bangalore ("CESTAT") in the matter of M/s FCI OEN Connectors v. Commissioner Of Central Tax & Central Excise, Cochin [Final Order No.20795/2021 dated October 21, 2021] held that when the customs duty is paid in excess, the department is liable to refund the same and the limitation provided under Section 27 of the Customs Act, 1962 ("the Customs Act") will not be applicable.

Citation :
Final Order No.20795/2021 dated October 21, 2021

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