Authority: High Court of Judicature at Bombay, Civil Appellate Jurisdiction

Order Date: 6 October 2026

Case Overview

  • Petitioner: IPCA Laboratories Ltd.
  • Respondents: Union of India & Others.
  • Writ Petition No.: 14846 of 2023.
  • Counsel for Petitioner: Mr. Parth Parikh and Mr. Yash Prakash, Economic Laws Practice.
  • Counsel for Respondents: Mr. Karan Adik and Ms. Sangeeta Yadav.
  • Subject Matter: Challenge to the collection of interest on Integrated Goods and Services Tax (IGST) levied under Section 3(7) of the Customs Tariff Act, 1975 for imports made between October 2017 and March 2018.
  • Legal Issue: Whether any provision in the Customs Tariff Act, 1975 or the Customs Act, 1962 authorises the imposition of interest on IGST.
  • Court’s Observations: The Court noted that no charging provision exists under either the Customs Tariff Act, 1975 or the Customs Act, 1962 for interest on IGST. It referred to its earlier decision in Mahindra & Mahindra Ltd. vs. Union of India & Ors. (2022 (10) TMI 212‑Bom HC) and to a recent decision dated 1 September 2026 in Leben Laboratories Pvt. Ltd. vs. Union of India & Ors. (Writ Petition No. 15373 of 2025), both of which support the view that interest cannot be levied without statutory authority.
  • Direction to Respondents: The Court held that the writ petition deserves to be allowed.
  • Further Instructions: The petitioner may file an application to the appropriate authority for a refund of the interest amount. Such an application must be considered expeditiously and a decision rendered within 16 weeks from the date of receipt of the application. The petitioner is required to satisfy the authority that the interest component has not been passed on to buyers or customers.

Final Outcome

  • The petition is disposed of in favour of IPCA Laboratories Ltd.; the Court allows the petition and directs that a refund application be processed within 16 weeks, effectively overturning the interest collection.

Topics: IGST Interest, Tax Refund, Customs Taxation