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2022 (5) TMI 645 - AT - Central ExciseInterest on delayed refund - relevant date for calculation of refund - refund sanctioned before issuance of SCN - HELD THAT:- Since the entire amount as was proposed to be recovered from the appellant was got deposited even prior to the issuance of Show Cause Notice and since the said demands stand already set aside, it stands clear that the said amount was not the liability of the appellant to be deposited i.e. it was not the amount of duty. Hence section 11B of Central Excise Act creating the notion of three months as impressed upon by learned Departmental Representative, is no applicable to the facts of present case. The amount which stands deposited since 06.07.2012 has been kept with the department with no authority for retaining the same. The Hon’ble Apex Court also has settled this issue in the case of SANDVIK ASIA LIMITED VERSUS COMMISSIONER OF INCOME-TAX AND OTHERS [2006 (1) TMI 55 - SUPREME COURT] holding the assessee entitled for interest along with the refund of the amount which he was not liable to pay to the department. In the Sandvik Asia case, Hon’ble Apex Court has appreciated section 243 of Income Tax Act which talks about the interest of delayed refund. Section 35FF of Central Excise Act, 1944 deals with similar situation and has actually held as para materia to section 243 of Income Tax Act by the Hon’ble Apex Court. Thus, it is held that Commissioner (Appeals) has committed an error while rejecting the claim of the interest on the entire amount of refund. No justification for the bifurcation have been given while sanctioning the interest only on the amount of pre deposit has been given in the order. It is also observed that the findings of the claim to be barred by time are also not correct as the relevant date for recovery period is considered as date of filing the appeal (i.e. 01.09.2014). Inspite of date of communication of the final order entitling the appellant from the impugned relief, 30.6.2017. Seeing from this angle also the order under challenge is not sustainable. The appellant is held entitled for the interest on the remaining amount of refund also that too at the rate of 12 Percent to be calculated from the date of payment thereafter - appeal allowed - decided in favor of appellant.
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