Refund - s.28 C of Customs Act, 1962

Refund S.28C Customs Act, 1962 Amendment proposed

Submitted to the Department of Revenue [Revenue Headquarters] through Grievance Redress Mechanism.

Ref. No. 070403 dt. 01.07.2010

Memorandum for amendment of s.28 C of the Customs Act, 1962 and regarding SAD refunds.

Our Original references - No. 070403 dt. 1.11.2008 to CCC Chennai and combined reminder letter 070401 Dt.27.05.09  [07401, 070402 and 070403] faxed on 17.6.09 to CCC Chennai with no response.

01. A lacuna is noticed in the wording of s.28C of the Customs Act, 1962 because of the phrase ‘ at the time of clearance of the goods’.  S. 12 A of the Central Excise Act, 1944 and s.28 C of the Customs Act, 1962 were inserted simultaneously, and are worded almost similarly though the word clearance has different connotations in Central Excise and Customs. Central Excise assessees prepare sale invoices commonly known as Central Excise Invoice on strength of which the goods are cleared out of the factory whereas the importer gets the goods on customs clearance. Sale, if any of the imported goods does not happen at the time of clearance but only after the customs out of charge is granted. As such s.28 C needs to be amended to read as ‘Notwithstanding anything contained in this Act or any other law for the time being in force, every person who is liable to pay duty on any goods shall, prominently indicate in all the documents relating to assessment, sales invoice, and other like documents, the amount of such duty which forms part of the price at which such goods are sold.’

02. In this regard, in the interest of the government, we submit the following grievance also.

03. Importers who apply for refund of Special Additional Duty - SAD are required to enclose sales invoices and other documents. On account of the Explanation to the definition ‘retail sale price’ in the Standards of Weights and Measures (Packaged Commodities) Rules, 1977 and under s.4A of the Central Excise Act, 1944 that the maximum price shall include all taxes -  in respect of refund of import duty of SAD paid on (1) goods covered under RSP based assessment and (2) packaged products on which MRP is to be declared as per the Standards of Weights and Measures Packaged Commodities Rules, 1977 read with DGFT Notification No. 44 dated 24th November 2000, sale invoices to the ultimate consumer has to be enclosed. However, the importers do not actually enclose any sales invoice with the Refund Application for SAD as required under Serial No. 9 (g)of Customs Series Form No. 102 Part A.

04. Even though CBEC has not issued any instruction exempting the requirement of s.27(1)b, s.28C or s.28D, the field officers ignore the statutory condition which was brought about after persistent effort and debate. It had been quite a long journey that made the Audit Para to take shape as  s. 28 C of the Customs Act, 1962 and s. 12 A of the Central Excise Act, 1944. The whole effort of the Audit and the PAC has become futile.  Kind attention is drawn to the debate in the Lokh Sabha at the time of insertion of  s. 12 A of the Central Excise Act, 1944 and s.28 C of the Customs Act, 1962 which is readily available  in the website However, till date ineligible persons are receiving the refunds without enclosing sales invoices wherein the duty element is declared.  Customs has to return such application to the applicant, pointing out the deficiency as per instructions contained in Para 3 of Chapter 15 of CBEC Customs Manual.  But the field officers issue acknowledgements as if the sale invoices were enclosed with the application and ultimately make huge ineligible refunds of SAD neglecting the statutory requirement of s.27(1)b, s.28C and the presumption of s.28D.  

05. The law enforcement officials are expected to abide by law in implementing it.  We hope your honour would countenance the above as worthy matters for issue of suitable instructions to the authorities for urgent action. We shall be much obliged if we are notified with the action taken please.

Successful Registration

Registration No. DORVU/E/2010/00070

Status as on 29 Jun 2011
Registration Number:DORVU/E/2010/00070
Name Of Complainant:Right Information International Forum
Date of Receipt:01 Jul 2010
Received by:Department of Revenue
Forwarded to:Department of Revenue
Officer name:Ms Niharika Barik Singh
Officer Designation:DS(Coord.)
Contact Address:Room No. 51-1
North Block,
New Delhi110001
Contact Number:23092282
Current Status:Closed (NO ACTION REQUIRED)
Date of Action:02 Jul 2010
Details:It does not pertain to Revenue Headquarter, Deptt. of Revenue.

Attachments (1)

  • Debate in Parliament for inserting s28C - Full Text.pdf - on May 30, 2010 5:49 PM by Right Informer (version 1) 
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