Sir,

I am directed to state that Board is in receipt of references seeking clarification regarding applicability of appropriate rate of interest on goods warehoused under Section 61 of the Customs Act, 1962. It has been contended that the interest of 24% p.a., fixed vide Notification No. 10/2001-Customs (NT), dated 01.03.2001, in respect of goods warehoused under Section 61 of Customs Act, 1962 may not be applicable after the issue of Notification No. 28/2002-Customs (NT), dated 13.05.2002, which prescribes an effective rate of interest at 15% p.a. under Section 47 of the Customs Act, 1962.

2. The matter has been examined in the Board. It is informed that the rate of interest of 15% p.a. has been fixed vide Notification No. 28/2002-Customs (NT), dated 13.05.2002, for the specific purpose of Section 47 of Customs Act, 1962. This rate of interest of 15% p.a. would not apply to goods warehoused under Section 61 of the Customs Act, 1962.

3. It is further clarified that in respect of warehoused goods, the rate of interest of 24% p.a. fixed vide Notification No. 10/2001-Customs (NT), dated 01.03.2001, would continue to remain in force. The Government is legislatively competent to do so as the said rate continues to be covered within the rates of 10% to 36% as prescribed in Section 47 ibid.

4. You are requested to take necessary action in the matter and inform all concerned suitably in the light of Board’s aforesaid clarification.

 

Yours faithfully,

( N.K. SINHA )
O.S.D. (LC)
Tel: 3360473.