Case Details: Commissioner of Customs (Air), Chennai vs. GMMCO Ltd. (2026) 43 Centax 386 (Mad.)
Judiciary and Counsel Details
- G. Jayachandran & N. Mala, JJ.
- Shri Ranjana Jain for M/s P. Rajkumar Jhabakh, for the Petitioner.
- Shri V. Sankaranarayanan, for the Respondent.
Facts of the Case
The assessee-importer imported engines and parts from its related supplier, and, pending the final determination of the declared transaction value, the Customs Department collected an Extra Duty Deposit (EDD) at the time of assessment. Subsequently, the Tribunal upheld the declared transaction value, and the Supreme Court dismissed the Department’s appeal, thereby confirming the declared value. Despite this, EDD continued to be collected for subsequent imports. The assessee filed a refund claim for the EDD, which was rejected on the ground that no proper refund application under Section 27 of the Customs Act, 1962 had been filed. The Commissioner (Appeals) held that the EDD, having been collected without legal sanction after acceptance of the declared value, was refundable along with interest. The Tribunal upheld the refund with interest under Section 27A. Aggrieved, the Revenue filed an appeal before the High Court.
High Court Held
The High Court held that once the declared transaction value had been finally accepted, the Extra Duty Deposit (EDD) collected thereafter lacked legal sanction and was liable to be refunded. It was observed that such a refund was required both on common law principles and under the statutory framework of the Customs Act. The Court further held that the refund of EDD squarely falls within the ambit of Section 27 of the Customs Act, 1962, and where there is delay in granting the refund after filing the claim, interest is payable under Section 27A. Accordingly, the Court dismissed the Revenue’s appeal and upheld the Tribunal’s order directing refund of the EDD with applicable interest.
