- (1.) The common question that falls for consideration in these appeals is whether a writ petition under Art. 226 of the Constitution of India seeking the relief of payment of interest on delayed refund of the amount paid by the assessee towards the customs duty, redemption fine and penalty under the Customs Act, 1962 (hereinafter referred to as 'the Act') was maintainable. Civil Appeal No. 3374/91.
(2.) M/s. Orient Enterprises, respondent No. 1, had imported consignments of skimmed milk powder from Canada. The Collector of Customs, Cochin, issued show cause notice on the basis that there was undervaluation of the prices in the invoices. The Collector of Customs passed an order for confiscation of the goods but permitted the respondents to redeem the goods on payment of redemption fine of Rs. 8,00,000/-. A penalty of Rs. 2,00,000/- was also imposed. On the basis of the higher price of goods, as assessed, the respondents were also required to pay the difference in customs duty to the extent of Rs. 34,464.23. The assessee filed an appeal against the said order of the Collector of Customs before the Central Board of Excise and Customs (hereinafter referred to as 'the Board'). The said appeal was dismissed by the Board. Thereafter the assessee filed a revision petition before the Central Government which was transferred to the Customs Excise and Gold (Control) Appellate Tribunal (hereinafter referred to as 'the Tribunal') and it was treated as an appeal by the Tribunal. By Order dated August 14, 1985 the Tribunal allowed the appeal and held that the goods had been lawfully imported and the valuation declared was correct. The appeal filed by the Revenue against the said judgment of the Tribunal was dismissed by this Court on December 10, 1996. After the passing of the adjudication order by the Collector the respondents deposited a sum of Rs. 10,34,464.23 on August 29, 1979. Since the said amount that was deposited by the respondents was not refunded to them after the judgment of the Tribunal dated August 14, 1985, the respondents approached the Tribunal for directions regarding the refund of the said amount and the Tribunal, by order dated May 8, 1987 directed the Collector of Customs, Cochin, to refund the said amount of Rs. 10,34,464.23 within a period of 60 days. The said amount was refunded on August 29, 1987. On November 21, 1989 the writ petition which has given rise to this appeal was filed by the respondents in the Delhi High Court. In the said writ petition the respondents sought the relief of payment of interest on the amount of Rs. 10,34,464.23 for the period from the date of payment of the said amount till the date on which it was refunded to the respondents. The said writ petition of the respondents has been allowed by the High Court by Judgment dated May 10, 1991. The High Court has directed the appellants to pay interest @ 12% per annum to the respondents on the sum of Rs. 10,35,000/- from the date of the filing of the revision application before the Central Government till the date of payment.
(3.) Shri R. Mohan, the learned senior counsel appearing for the appellants has urged that the High Court was in error in entertaining the writ petition and giving directions regarding payment of interest on the amount that was collected from respondent No. 1 on the basis of the order of Collector of Customs and which was subsequently refunded to them in pursuance of the judgment of the Tribunal. The submission is that under the provisions of the Act, as they stood at the relevant time there was no provision for payment of interest on the amount collected on the basis of an order passed under the Act and which was subsequently required to be refunded and that such a provision for payment of interest on the amount of duty that is refunded has been introduced by S. 27-A which was inserted in the Act by Act No. 22 of 1995. It has also been pointed out that in the affidavit filed on behalf of the appellants in reply to the show cause notice in the writ petition before the High Court it was stated : "It is further submitted that the Customs Department does not charge any interest on the short payment of duty on goods imported or exported. No interest is charged on delayed payment of fine or penalty imposed on the importer/exporter for violation of the provisions of the Customs Act, 1962. Similarly, no interest can be paid on the amount refunded in pursuance of the order-in-appeal.";