SECTION 28AA.

(1) Notwithstanding anything contained in any judgment, decree, order or direction of any court, Appellate Tribunal or any authority or in any other provision of this Act or the rules made there under, the person, who is liable to pay duty in accordance with the provisions of section 28,shall, in addition to such duty, be liable to pay interest, if any, at the rate fixed under sub-section (2),whether such payment is made voluntarily or after determination of the duty under that section.

(2) Interest at such rate not below ten per cent. and not exceeding thirty-six per cent. per annum, as the Central Government may, by notification in the Official Gazette, fix, shall be paid by the person liable to pay duty in terms of section 28 and such interest shall be calculated from the first day of the month succeeding the month in which the duty ought to have been paid or from the date of such erroneous refund, as the case may be, up to the date of payment of such duty.

(3) Notwithstanding anything contained in sub-section (1), no interest shall be payable where,-

(a) the duty becomes payable consequent to the issue of an order, instruction or direction by the Board under section 151A; and

(b) such amount of duty is voluntarily paid in full, within forty-five days from the date of issue of such order, instruction or direction, without reserving any right to appeal against the said payment at any subsequent stage of such payment.

(ABOVE SECTION 28AA SUBSTITUTED VIDE THE FINANCE BILL, 2011)

SECTION 28AAA

(1) Where an instrument issued to a person has been obtained by him by means of -

(a) collusion; or

(b) wilful misstatement; or

(c) suppression of facts,

for the purposes of this Act or the Foreign Trade (Development and Regulation) Act, 1992, by such person or his agent or employee and such instrument is utilised under the provisions of this Act or the rules made or notifications issued there under, by a person other than the person to whom the instrument was issued, the duty relatable to such utilisation of instrument shall be deemed never to have been exempted or debited and such duty shall be recovered from the person to whom the said instrument was issued:

Provided that the action relating to recovery of duty under this section against the person to whom the instrument was issued shall be without prejudice to an action against the importer under section 28.

Explanation 1.- For the purposes of this sub-section, "instrument" means any scrip or authorisation or licence or certificate or such other document, by whatever name called, issued under the Foreign Trade (Development and Regulation) Act, 1992, with respect to a reward or incentive scheme or duty exemption scheme or duty remission scheme or such other scheme bestowing financial or fiscal benefits, which may be utilised under the provisions of this Act or the rules made or notifications issued there under.

Explanation 2.- The provisions of this sub-section shall apply to any utilisation of instrument so obtained by the person referred to in this sub-section on or after the date on which the Finance Bill,2012 receives the assent of the President, whether or not such instrument is issued to him prior to the date of the assent.

(2) Where the duty becomes recoverable in accordance with the provisions of sub-section (1), the person from whom such duty is to be recovered, shall, in addition to such duty, be liable to pay interest at the rate fixed by the Central Government under section 28 AA and the amount of such interest shall be calculated for the period beginning from the date of utilisation of the instrument till the date of recovery of such duty.

(3) For the purposes of recovery under sub-section (2), the proper officer shall serve notice on the person to whom the instrument was issued requiring him to show cause, within a period of thirty days from the date of receipt of the notice, as to why the amount specified in the notice(excluding the interest) should not be recovered from him, and after giving that person an opportunity of being heard, and after considering the representation, if any, made by such person, determine the amount of duty or interest or both to be recovered from such person, not being in excess of the amount specified in the notice, and pass order to recover the amount of duty or interest or both and the person to whom the instrument was issued shall repay the amount so specified in the notice within a period of thirty days from the date of receipt of the said order, along with the interest due on such amount, whether or not the amount of interest is specified separately.

(4) Where an order determining the duty has been passed under section 28, no order to recover that duty shall be passed under this section.

(5) Where the person referred to in sub-section (3) fails to repay the amount within the period of thirty days specified therein, it shall be recovered in the manner laid down in sub-section (1) of section 142.

(ABOVE SECTION 28AAA ADDED VIDE THE FINANCE BILL, 2012)

[OLD - SECTION 28AA.

(1)*Subject to the provisions contained in section 28AB where a person, chargeable with the duty determined under sub-section (2) of section 28, fails to pay such duty within three months from the date of such determination, he shall pay, in addition to the duty, interest at such rate not below ten per cent * and not exceeding thirty six per cent per annum, as is for the time being fixed by the Board, on such duty from the immediately after the expiry of the said period of three months till the payment of such duty :

(* Words in bold substituted wef 01/03/2002 & it has replaced "eighteen per cent")

Provided that where a person chargeable with duty determined sub-section (2) of section 28 before the date on which the Finance Bill, 1995 the assent of the President, fails to pay such duty within three months from date, then, such person shall be liable to pay interest under this section fro date immediately after three months from such date; till the date of payment of such duty.

Explanation 1. -Where the duty determined to be payable is reduced Commissioner (Appeals), Appellate Tribunal or, as the case may be, the court date of such determination shall be the date on which an amount of duty is determined to be payable.

Explanation 2, -Where the duty determined to be payable is increased or increased by the Commissioner (Appeals), Appellate Tribunal or, as the case be, the court, the date of such determination shall be, -
(a) for the amount of duty first determined to be payable, the date which the duty is so determined;
(b) for the amount of increased duty, the date of order by which increased amount of duty is first determined to be payable;
(c) for the amount of further increase of duty, the date of order on which the duty is so further increased.

(2)* The provisions of sub-section (1) shall not apply to cases where the duty or the interest 40 becomes payable or ought to be paid on and after the date on which the Finance Bill, 2001 receives the assent of the President.".]

(Please refer Cus Cir No.48/2002 Date 09/08/2002)

(* Section 28AA renumbered as 28AA(1) and new subsection 28AA(2) inserted wef 01/03/2001)

(Please refer Cus Ntf No.26/2002(NT),dt.13/05/2002)