Interest on delayed drawback payments is statutory, arising from the date of claim submission, regardless of administrative delays. Section 75A of the Customs Act mandates this entitlement.

ORDER :

N.ANAND VENKATESH, J.

1. This writ petition has been filed challenging the proceedings of the third respondent dated 13.6.2024 and for a consequential direction to respondents 4 and 5 to pay the statutory interest amount on delayed payment of drawback made by them from 12.10.1994 as directed by the second respondent vide orders dated 14.9.2020 and 27.7.2022.

2. Heard both.

3. The case of the petitioner is as follows :

(i) The petitioner was exporting garments during the period 1992-1994 and was also importing ancillary goods. At that point of time, the petitioner availed Duty Entitlement Exemption Certificate (DEEC), which was also known as advance licence as incentive for the exports made by the petitioner in lieu of drawback amount payable against exports under 69 shipping bills.

(ii) Some disputes arose relating to payment of customs duty after availing the DEEC licence and eventually, it was resolved with the Customs Department for payment of duty demanded on exports made under Kar Vivad Samadhan Scheme. The petitioner made an application on 12.12.1994 before the Joint Director General of Foreign Trade, Chennai (JDGFT), Chennai-14 for conversion of the 69 shipping bills under the DEEC licence to drawback shipping bills and asked for the drawback to be paid for the exports made under the 69 shipping bills. But, no decision was taken in spite of repeated requests made by the petitioner. Ultimately, an order dated 17.8.2007 came to be passed by the Commissioner of Customs (Export), Customs House, Rajaji Salai, Chennai-1 rejecting the request made by the petitioner for conversion of advance licence shipping bills to drawback shipping bills.

(iii) The said order dated 17.8.2007 was put to challenge by the petitioner by filing W.P.No.5480 of 2009 before this Court and it was allowed by order dated 23.10.2019 in the following terms :

"6. For the aforesaid reasons, the impugned order fails and is set aside. The first respondent will issue a notice to the petitioner calling upon it to appear for a personal hearing and pass orders de novo on the request of the petitioner for conversion of Advance Licence shipping bills to Drawback shipping bills. The petitioner is granted liberty to file supporting documents, if any in addition to advancing oral submissions. After conclusion of personal hearing, a speaking order on merits shall be passed by the first respondent within a period of four (4) weeks."

(iv) Pursuant to the said order dated 23.10.2019, the Customs Authorities passed several orders allowing the drawback claim with a finding that the claim for drawback was filed by the petitioner on 12.12.1994, that all the conditions relating to the grant of drawback under Section 75 of The Customs Act, 1962 (for short, the Act) have been satisfied by the petitioner and that the total drawback amount was Rs.21,66,004/- for the exports made under the 69 shipping bills.

(v) After the above orders were passed, the second respondent, vide order dated 14.9.2020, found that the petitioner would be eligible for the drawback for the exports made under the 69 shipping bills. But, the second respondent curtailed the payment to 50% of the total drawback amount. Further, a direction was issued to respondents 4 and 5 to make the payment in accordance with the provisions of Section 75 of the Act.

(vi) Pursuant to the said order dated 14.9.2020, respondents 4 and 5 passed orders respectively dated 30.4.2021 and 07.5.2021 for payment of 50% of the drawback amount without any interest being paid for the delayed payment, which according to the petitioner, were contrary to the p