Interest on delayed payment of duty
Section 28AA of the Customs Act, 1962 deals with interest on delayed payment of duty. 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 thereunder, the person, who is liable to pay duty in accordance with the provisions of section 28, shall, in additi The Act came into force on 01 Feb 1963.
1[28AA. Interest on delayed payment of duty--[(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 thereunder, 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.]
Section 28AA, The Customs Act, 1962 (Act 52 of 1962).
Cross-references
Extracted from the operative text of the enactments themselves. Every destination below exists in our corpus.
This section refers to
Referred to by 7
- s. 28 Recovery of duties not levied or not paid or short-levied or short-paid or erroneously refunded
- s. 28AAA Recovery of duties in certain cases
- s. 75A Interest on drawback
- s. 112 Penalty for improper importation of goods, etc
- s. 114 Penalty for attempt to export goods improperly, etc
- s. 127B Application for settlement of cases
- s. 127I Power of Settlement Commission to send a case back to the proper officer
Related judgements & precedents
These are some judgments that construed this section, and hold precedence value. They hold authority on how to read, interpret and use this section.
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Rexnord Electronics and Controls LTD vs Union of India
Court's Decision & Legal Precedent
The jurisdiction of the Settlement Commission under Section 127H of the Customs Act to grant immunity from interest is limited to interest payable under the provisions of the Customs Act itself. Interest payable under a contractual bond executed in terms of an exemption or duty notification, though issued under statutory authority, retains its contractual character and falls outside the Settlement Commission's powers of waiver or immunity. The Settlement Commission lacks the authority to grant immunity from such contractual obligations without the consent of both parties to the contract.
On this section: Specifies that interest at rate between 10% and 30% per annum is payable for delayed payment of duty determined under Section 28, applicable after three months from determination date
The holding above is the ratio decidendi as extracted from the judgment by eCourts India, reproduced unaltered — it is a rendering of the court's reasoning, not a substitute for its words. Read the order itself before relying on it.
Judgments citing this section
These may be obiter dicta or a precedent, for you to study. These are the judgments where this section is quoted.
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… Thereafter, the 1st respondent passed Ext.P10 order dated 25/7/2023 confirming the -:4:- short levied duty of 7,17,374/- as demanded in Ext.P4 show cause notice and also interest on the short levied duty under Section 28AA of the Customs Act. The appellant challenged Ext.P10 order before the learned Single Judge. The learned Single Judge, as per judgment dated 22nd December, 2023, dismissed the writ petition relegating the appellant to the statutory appellate remedy. It is challenging the said judgment of the learned Single Judge; the …
Made under this section, and citing it
3 instruments name this provision in its title or its text without being made under it.
Questions about Section 28AA
What have the courts held on Section 28AA of the Customs Act?
Rexnord Electronics and Controls LTD vs Union of India (04 Mar 2008) is the leading judgment on this section among those set out below: Specifies that interest at rate between 10% and 30% per annum is payable for delayed payment of duty determined under Section 28, applicable after three months from determination date.
How do I find court cases under Section 28AA of the Customs Act?
In judgments and charge sheets this section is written several ways, and each form finds a different set of orders. These search the full text of every order eCourtsIndia holds, best matches first: Customs Act 1962 28AA, section 28AA Customs Act 1962, section 28AA of the Customs Act. Each opens the full list of orders on eCourtsIndia, where it can be narrowed by court, year and outcome. 1 reported judgment on this section is set out on this page, beginning with Rexnord Electronics and Controls LTD vs Union of India (04 Mar 2008).
What should I read with Section 28AA of the Customs Act, and has it changed?
Its own text turns on section 28 (Recovery of duties not levied or not paid or short-levied or short-paid or erroneously refunded), section 151A (Instructions to officers of customs), so none of them can safely be read on its own. 7 other provisions in this corpus refer back to it. 3 instruments name it without being made under it, most recently Notification No.68/2017-Cus(NT), dated 30.6.2017 (2017), then Interest on Delayed Payment of Duty - Clarification - Circular No.48/2002-Customs, dated 9.8.2002 (2002).
When did Section 28AA of the Customs Act come into force?
Section 28AA of the Customs Act, cited as Customs Act 1962 28AA, came into force on 01 Feb 1963, having been enacted on 13 Dec 1962. It is in force as at the date shown on this page.
Other sections of this Act
- 28. Recovery of duties not levied or not paid or short-levied or short-paid or erroneously refunded2145 words
- 2. Definitions1638 words
- 129A. Appeals to the Appellate Tribunal1170 words
- 27. Claim for refund of duty1060 words
- 127C. Procedure on receipt of an application under section 127B1056 words
- 138C. Admissibility of micro films, facsimile copies of documents and computer print outs as documents and as evidence872 words
Source and method. Compiled from the enactments of Parliament and of the State legislatures as published on India Code, and republished together with commentary and other original matter under section 52(1)(q)(ii) of the Copyright Act, 1957. Structured, cross-referenced and maintained by eCourtsIndia. Text as in force on 15 Oct 2026. This page is not a substitute for legal advice.