TMI Blog2019 (11) TMI 10X X X X Extracts X X X X X X X X Extracts X X X X ..... of refund of indirect taxes. The said rule of interpretation is otherwise contained in order-21 Rule-1 of Civil Procedure Code relating to execution of decrees for recovery of money. Such a provision stands absolutely excluded from the Central Excise Act, 1944. Appeal dismissed. - Excise Appeal No. 50125 of 2019 [SM] - FINAL ORDER No. 50125/2019 - Dated:- 31-10-2019 - MRS. RACHNA GUPTA, MEMBER (JUDICIAL) Shri Narender Singhvi, Advocate for the Appellant Shri K. Poddar Ms. Tamana Alam, Authorised Representatives (DRs) for the Respondent ORDER The appellant herein assails the order-in-original No. 23/2018 dated 26.04.2018. The facts in brief relevant for the purpose are : 2. The appellant herein is engaged in manufacture of marble slabs and tiles. On 21.02.2012 the Appellant filed a refund claim of ₹ 6,52,097/- for interest paid under protest on reversal of ineligible Cenvat Credit, as they had paid interest of ₹ 6,52,432/- against the actual interest liability of ₹ 335/-. The refund application of the Appellant was rejected by the Deputy Commissioner vide Order-in-Original No. 2 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rned Advocate for the Appellant and Mr. K. Poddar, learned Authorised Representative for the Department. It is submitted on behalf of appellant that in furtherance of the order of CESTAT dated 22.03.2016, the appellant became entitled for the interest w.e.f. the date of filing of application i.e. 21.02.2012, but it could got sanctioned, only in the year 2018. The delay of more than 6 years for getting the amount of interest refunded entitles the appellant to be compensated for the same. It is impressed upon that interest is compensatory in nature, therefore, interest on delayed sanction of interest is payable. Learned Counsel has relied upon the decision of Hon ble Supreme Court in the case of Sandvik Asia Ltd. Vs. CIT reported as 2006 (196) ELT 257 (S.C) and that the ratio has not be disapproved by Hon ble larger bench in Gujrat Fluorochemicals Vs. CIT reported as 2008 (300) ITR 328 (Guj.) . 3.1 It is submitted that the said decision has not been overruled rather has been relied upon by Supreme Court in a subsequent decision in the case of CIT Vs. Gujarat Fluoro Chemicals itself. Even the division bench of Gujrat, after the matter was referred back b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... decision of Sandvik Asia Ltd. (Supra). It has been pointed out that the Hon ble Supreme Court has clarified therein that it is only that interest as provided for under the statute which may be claimed by an assessee from the Revenue and no other interest on such statutory interest. It was only the compensation which as per Hon ble Apex Court may be granted to the assessee. There is no power vested with the Tribunal to grant compensation in view of delay, if any. It is impressed upon that there is no infirmity, as alleged, in the order-under-challenge. Appeal is, accordingly, prayed to be dismissed. 5. After hearing the rival contentions of the parties and perusing the appeal record as well as the case law relied upon. We observe and hold as follows : Present is the case where the appellant had filed refund claims in respect of service tax paid on certain services received and used for the export of goods. The refund claim was accordingly filed on 21.02.2012. The refund claim appeal was initially rejected, however, this Tribunal vide order dated 22.03.2016 while affirming the eligibility of the appellant to said refund claims, remanded the m ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... any court against an order of the Assistant Commissioner of Central Excise, under sub-section (2) of section 11B, the order passed by the Commissioner (Appeals), Appellate Tribunal or, as the case may be, by the court shall be deemed to be an order passed under the said sub-section (2) for the purposes of this section.] The provision makes it, abundantly, clear that the interest is allowed on delayed refunds. But the provision is silent about any interest on delayed payment of interest as claimed herein. Learned Counsel for appellant has relied upon Sandvik Asia Ltd. (Supra) case, impressing upon that the Hon ble Apex Court has allowed such amount in case of apparent delay. But it is observed that there has been express clarification that such interest only can be claimed by an assessee which is provided under the statute and no other interest on such statutory interest can be granted. The relevant para of the decision of a division bench of Hon ble Supreme Court while considereing a reference doubting correctness of their previous decision of Sandvik Asia case had held as : In our considered view, the aforesaid judgment has been misquo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... (supra) and the latter decision of the Larger Bench in the case of Gujarat Fluoro Chemicals (supra) it appears that the liability to pay interest on interest by the Revenue is not approved and to that extent the contention of the Revenue can be maintained. But the further contention of the Revenue that no interest whatsoever would be payable if the refund of the amount of tax or refund of the amount deposited towards tax is to be made, no interest whatsoever would be available by way of compensatory measure. 17. In our view, the general principles for awarding compensation to the Assessee for the delay in receiving monies properly due to it is not disapproved by the Larger Bench of the Apex Court in the case of Gujarat Fluoro Chemicals (supra). 18. In view of the aforesaid observations and discussion, we find that the petitioner - Assessee would be entitled to compensation and the interest can be awarded by way of compensation, but would not be entitled to further compensation by way of interest on such interest, which is awarded as compensation. 19. Under these circumstances, we find that the Court can take a reasonable approach when the i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ry in nature is not sustainable. Since, it technically is interest on interest it cannot be called as compensation suo moto, nor has been so prayed by the appellant himself. In view of this discussion, we answer the afore framed question in favour of Revenue. 9. Now coming to the alternate argument of the Appellant that from the amount of refund sanctioned since there is an interest liability, the amount should be first adjusted towards the interest liability. It is observed that this rule of first appropriating the interest is applicable only to the debts or to the decreetal amount. The case law as relied upon by the appellant is also either qua debts or qua the decreetal amount. Hence, the same is not applicable to the present case of refund of indirect taxes. The said rule of interpretation is otherwise contained in order-21 Rule-1 of Civil Procedure Code relating to execution of decrees for recovery of money. Such a provision stands absolutely excluded from the Central Excise Act, 1944. Further, hon'ble Apex Court in the case law relied upon by the Appellant i.e in the case of V. Kala Bharathi (supra) has rather clarified that, after such appr ..... X X X X Extracts X X X X X X X X Extracts X X X X
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