ALO Law Office- IDT Tax I Arbitration I Litigation
Date: 26.09.2025
CESTAT Chennai Upholds Interest on Delayed SAD Refunds
This Article has been written by Shri Ravi Shekhar Jha, Advocate based in New Delhi. The views expressed are based on his interpretation of the law. He can be reached at his email id intelconsul@gmail.com or on his Mobile +91-9999005379.
In a significant ruling, the Customs, Excise & Service Tax Appellate Tribunal (CESTAT), Chennai, has dismissed the appeal filed by the Commissioner of Customs, Chennai Commissionerate-IV, against M/s HLG Trading. β This decision reinforces the entitlement of importers to interest on delayed refunds under Section 27A of the Customs Act, 1962, even in cases governed by exemption notifications like Notification No. β 102/2007-Cus.
Background of the Case
The dispute arose when M/s HLG Trading sought refunds of additional duty of customs under Section 3(5) of the Customs Tariff Act, 1975, along with interest for the delay in processing the refunds. β While the refund amounts were sanctioned by the Assistant Commissioner (Refunds), the claim for interest was rejected, citing that the refund scheme under Notification No. 102/2007-Cus was not governed by Section 27 or Section 27A of the Customs Act, 1962. β
Aggrieved by this rejection, M/s HLG Trading approached the Commissioner (Appeals), who ruled in their favor, directing the lower adjudicating authority to calculate and sanction interest. The Department, dissatisfied with this decision, escalated the matter to CESTAT Chennai.
Source: CESTAT Chennai
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