Leben Laboratories Pvt. Ltd. Vs Union of India & Ors. (Bombay High Court)
SEO Title: Bombay HC Orders Refund of IGST Interest Paid Without Legal Authority
Summary: The Bombay High Court allowed the writ petition filed by Leben Laboratories Pvt. Ltd. and directed the competent authorities to process and expeditiously refund the interest paid by the petitioner on repayment of additional duties of customs. The petition concerned the levy, collection and retention of interest on IGST paid on imports under Section 3(7) read with the unamended Section 3(12) of the Customs Tariff Act, 1975 for the period before 16 August 2024.
The petitioner had imported raw materials under the Advance Authorisation Scheme and claimed exemption from additional duties of customs under Section 3(7) of the Customs Tariff Act, 1975. The imported materials were used to manufacture products exported from India. On export, the petitioner paid IGST and claimed refund under Section 16 of the IGST Act.
Between 4 October 2018 and 27 November 2020, the petitioner made 25 such imports, claiming the import-side exemption and subsequently obtaining refund of IGST paid on exports. The explanation to Rule 96(10) of the CGST Rules, introduced retrospectively with effect from 23 October 2017, was stated to require repayment of one of the two benefits where both had been claimed. The petitioner chose to repay the additional duties of customs on the import side by recalling the bills of entry and obtaining reassessment with recomputed duty.
