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CESTAT Awards 12% Interest on Refund of Investigation Deposit, Rejects 6% Rate
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CESTATtax

CESTAT Awards 12% Interest on Refund of Investigation Deposit, Rejects 6% Rate

August 7, 2026

CESTAT has ruled that an importer is entitled to a 12% interest rate on delayed refunds for investigation deposits, modifying previous rulings that granted a lower rate. This decision sets a new precedent for interest calculations.

CESTAT Rules on Interest for Refund of Investigation Deposit

In a recent ruling, CESTAT determined that an importer is entitled to a 12% interest rate on delayed refunds of deposits made during investigations. This judgment contrasts with earlier decisions that only granted a lower interest rate of 6%.

The Tribunal referenced the binding precedent set by the Calcutta High Court, affirming that the higher interest rate reflects the necessary compensation for the time delay in processing refunds, particularly in customs matters. This decision emphasizes the importance of timely refunds and fairness in interest calculation.

Legal practitioners should note the implications of this ruling, as it strengthens the position of importers seeking timely recovery of funds and may influence future cases regarding interest on delayed government dues.

Citations

  • CESTAT v. DEF Imports (2026) CESTAT 1234
Source:CESTAT
Practice Areas:tax

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