Sections 28C and 28D explained: this guide covers what it means, who it applies to, the step-by-step process, documents required, fees, due dates and penalties in India — so you can stay compliant with confidence and avoid costly mistakes.
Section 28C requires a person who pays duty to show the amount of that duty in assessment documents, sales invoices and similar papers when the goods are cleared. Section 28D then presumes that a person who has paid duty has passed the full incidence of it to the buyer, unless that person proves otherwise. Together they sit behind the refund rules in section 27.
This article follows the Customs Act, 1962 as per the text on the CBIC portal updated to 30 March 2022. Later Finance Acts must be checked for changes to these sections before you act on them.
Every person liable to pay duty must, at the time of clearance, prominently indicate in all documents relating to assessment, sales invoice and other like documents the amount of duty that will form part of the selling price. Under section 28D, a person who has paid duty is deemed to have passed on the full incidence of that duty to the buyer, unless he proves the contrary. The presumption matters most when a refund is claimed under section 27.
Chapter VA and its purpose
Sections 28C and 28D make up Chapter VA, headed "Indicating amount of duty in the price of goods, etc., for purpose of refund". The footnote prints that the chapter was inserted by section 13 of the Central Excise and Customs Laws (Amendment) Act, 1991 (40 of 1991), w.e.f. 20-9-1991. The chapter heading itself tells you why the sections exist: a refund of duty is not meant to go to someone who has already recovered the duty from a buyer.
Section 28C: price of goods to indicate the amount of duty paid
Section 28C opens with "Notwithstanding anything contained in this Act or any other law for the time being in force". Then it sets one duty:
- Who: every person who is liable to pay duty on any goods.
- When: at the time of clearance of the goods.
- What: prominently indicate, in all the documents relating to assessment, sales invoice and other like documents, the amount of such duty which will form part of the price at which the goods are to be sold.
If you want your invoice format checked against this requirement, a legal consultation is a sensible first step. Three points follow from the wording.
- The duty must be shown, not just charged. The amount must be indicated prominently, which means it should be easy to find on the invoice and on the assessment papers.
- The amount is the amount of duty that forms part of the price. The section speaks of duty "which will form part of the price at which such goods are to be sold", so it concerns duty built into the selling price.
- The section prints no penalty or consequence. The consequence the Act draws from this documentation shows up in section 27, as explained below.
Section 28D: presumption that incidence of duty has been passed on
Section 28D is one sentence. Every person who has paid the duty on any goods under this Act shall, unless the contrary is proved by him, be deemed to have passed on the full incidence of such duty to the buyer of the goods.
The presumption can be rebutted, and the burden is on the person who paid the duty. The text says "unless the contrary is proved by him". The word "full" matters: the presumption is that the whole incidence has gone to the buyer, not part of it.
How the two sections connect to refund under section 27
These sections are read with section 27, and two of its sub-sections name the incidence of duty directly.
| Section 27 provision | What it says in the copy consulted |
|---|---|
| Sub-section (1A) | The refund application must be accompanied by such documentary or other evidence, including the documents referred to in section 28C, as the applicant may furnish to establish that the duty or interest was collected from, or paid by him and that the incidence has not been passed on by him to any other person |
| Sub-section (2), first proviso | The refund determined is paid to the applicant, instead of being credited to the Fund, if it is relatable to the cases listed in clauses (a) to (g), including duty paid by an importer or exporter who had not passed on the incidence to any other person, and duty borne by a buyer who had not passed it on |
So section 28C's invoices and assessment documents are the evidence the refund applicant can bring, and section 28D is the starting presumption the applicant has to answer. Our article on Section 27 takes the refund procedure sub-section by sub-section. The post on customs refund grounds and the claim process gives the business view.
Note also that sub-section (2) of section 27 has clauses for imports by an individual for personal use, export duty as specified in section 26, and drawback payable under sections 74 and 75. Those clauses do not depend on proving non-passing-on in the same way; read the sub-section itself for the exact wording.
Related provision: section 28B
Section 28B deals with the opposite situation, where a person has collected from a buyer more than the duty assessed or paid, or has collected an amount as duty on exempt or nil-rated goods. The amount must be paid to the Central Government, and any surplus is credited to the Fund or refunded under section 27 to the person who bore the incidence. Our article on Section 28B covers it.
A worked example
Lakshmi Traders imports goods and pays duty at the port. The assessed bill of entry shows the duty amount. When Lakshmi Traders sells the goods, the invoice shows the duty amount that forms part of the price, as section 28C requires. Later the importer finds that duty was paid in excess and applies for a refund. Under section 28D, the department can treat Lakshmi Traders as having passed the full incidence of the duty to its buyer, unless Lakshmi Traders proves the contrary. Lakshmi Traders therefore files its application with the documents referred to in section 28C and other evidence to show that the incidence was not passed on, as sub-section (1A) of section 27 requires. If the evidence is accepted, the refund is paid to Lakshmi Traders under the first proviso to section 27(2).
If instead the buyer, Rohan Enterprises, claims the refund as the person who bore the duty, the relevant clause is the one for duty borne by the buyer who had not passed the incidence on to any other person.
Practical points
- Show the duty on the invoice, prominently. It is a duty on the person liable to pay duty, at the time of clearance.
- Keep assessment documents with the invoice file. Section 27(1A) names the documents referred to in section 28C as part of the evidence.
- Plan your proof before you claim. Section 28D puts the burden of proving the contrary on you.
- Decide who claims. The importer or exporter who did not pass the incidence on, and a buyer who bore it and did not pass it on, are separate categories in section 27(2).
Need help with a duty refund or invoicing under these sections?
If you are preparing a refund claim where passing on of duty is in question, or want your invoices checked against section 28C, we can review your documents with you. Start with our legal consultation service.
Key takeaways
- Section 28C requires the person liable to pay duty to prominently indicate the duty amount in assessment documents, sales invoices and similar documents at the time of clearance.
- Section 28D presumes that the full incidence of paid duty has been passed on to the buyer unless the payer proves the contrary.
- Section 27(1A) links refund applications to evidence, including the documents referred to in section 28C.
- Section 27(2) decides whether a refund is paid to the applicant or credited to the Fund.
- Chapter VA was inserted w.e.f. 20-9-1991, as the footnote prints.
Read next
- Section 27: claim for refund of duty and unjust enrichment
- Section 28B: duty collected from the buyer
- Sections 28BA and 28BB: provisional attachment and time limit
- Customs refund: grounds and claim process
Disclaimer: Based on the Customs Act, 1962 as published on the CBIC Tax Information Portal, updated to 30 March 2022 (amended up to the Finance Act, 2022), as consulted on 2 October 2026. Finance Acts of 2023 and later, and the current rules, regulations and notifications, should be checked. This article is general information, not legal advice; check the official text before acting.