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2016 (9) TMI 1405 - HC - Service TaxRefund of excess service tax paid - entitlement to interest - Held that: - If an amount is paid by an assessee, in duly of excise, pursuant to a liability created under a Statute or by statutory order, passed by competent authority, and such demand is later found illegal, Section 11 AB contemplates that amount received shall be refunded to assessee provided that the incidence of such duty had not been passed on by him to any other person - In the present case, the amount in question, refund whereof is claimed, was not paid. It is not such amount of duty which was deposited by assessee. To check evasion of 'Excise duty' or 'Service Tax', raid was conducted on 12.1.2007, when during raid, sum of ₹ 25,55,000/- was got deposited. Amount of interest thereon was subsequently realized from petitioner on 29.3.2007 i.e. before issue of notice on 3.7.2007. Such deposit was involuntary by petitioner since no one shall deposit a huge money without creation of liability in law. Such an amount has been held to be a pre-deposit and principles of unjust enrichment has been held inapplicable in such cases. Circular No. 802/35/2004-CX : MANU/EXCR/0037/2004 dated 8.12.2004 provides that against an order whereunder refund is admissible to an assessee with regard to the pre-deposit, if an appeal is pending, that shall not be taken as justification for denying refund. Interest on delayed deposit or refund - Held that: - a Division Bench of Delhi High Court in Surinder Singh v. Union of India, [2006 (11) TMI 12 - HIGH COURT, DELHI], relying on Supreme Court judgment in Prince Khadi Woollen Handloom Producers Cooperative Society v. CCE, [1996 (11) TMI 72 - SUPREME COURT OF INDIA], said that State, if has wrongly collected a tax from a person, and, even if there is no specific provision, still is liable to refund tax alongwith interest. The consensus of the authorities of various High Courts as well as Supreme Court is that any amount received by Revenue, as deposit or pre-deposit i.e. unauthorizedly or under mistaken notion etc., cannot be retained by Revenue since it has no authority in law to retain such amount and it must be refunded with interest. Petition allowed - decided in favor of petitioner.
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