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2016 (12) TMI 476 - HC - Central ExcisePartial withholding of the refundable excise duty - The litigants are industrial units which were set up in the designated duty exemption zones in the North Eastern States, under the new industrial policy resolution of the Central Government, notified in the year 1997 and 2007. These industries were made eligible for 100% tax exemption and concession by the two notification(s) of 08.07.1999 and 25.04.2007, for 10 year period. As per the incentive mechanism, full refund of excise duty was provided to the units - Notification No.20/2007- Central Excise - Held that: - it would be appropriate to take note of the fact that for certain categories of industries, the rate of refundable excise duty is stipulated at 75% and if we approve the calculation of the Deputy Commissioner under his order of 12.02.2016, a successful litigant may have to pay back to the authorities a portion of the permitted refundable sum, instead of getting back 50% of the differential amount, in terms of the interim order passed by the Apex Court. The interim order passed by the Hon’ble Supreme Court on 07.12.2015 in the I.A. No.3/2015 was made applicable by the Gauhati High Court in all the pending cases and therefore the determination of the amount due in terms of the Court’s interim order, cannot include what was undisputedly paid back as refundable excise duty, which the manufacturers were entitled to receive, irrespective of the outcome of the litigation. Therefore inclusion of those already refunded sum, was not justified for determining the amount due. In our understanding, only the differential amount can be taken into account for deciding what sum to be paid back now to the manufacturer. In other words, 50% of the unpaid amount is the due amount and this must be refunded to the eligible units, subject to furnishing of solvent surety to the satisfaction of the jurisdictional commissioner. It is declared so accordingly. Before we part with the records, it is necessary for us to observe that while relief through the judgment of June 24th 2009 was confined to the writ petitioners, the benefit of the relief was expanded to cover all the industries set up pursuant to policy of 1997 and 2007, under the Division Bench judgment dated 20.11.2014 in the WA No.243/2009. Therefore, our above observation on the receivable amount will universally apply to all the eligible industries and the interim relief is not to be restrictive to only the litigants, before the Court - by virtue of the interim order operating in all these cases, the respondent authorities are ordered to disburse 50% of the withheld segment of the refundable amount, to the units subject to furnishing of solvent surety by those units. Such interim refund or the entitlement to receive the balance 50% of the withheld sum, will abide by the final decision of the Hon’ble Supreme Court in the pending challenge of the central Government in SLP(C) No.11878/2015 and other related cases. It is ordered accordingly. As the petitioners have been deprived of the benefit of the successful litigation and the respondents are expected to act with promptitude in granting due refund, the necessary exercise in this regard should be completed within 8(eight) weeks, from today.
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