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2022 (9) TMI 131 - Service Tax
Interest on Refund of the pre-deposit amount - entitlement of interest from the date of deposit of the said amount or not - section 35FF of the Central Excise Act, 1944 - HELD THAT:- The ‘Heading’ of the amended section 35FF does not deliberately make a mention of any amount deposited under the proviso to section 35F for the simple reason that post 06.08.2014 the amount is deposited under the amended section 35F and not the proviso to the unamended section 35F. Section 35FF, post 06.08.2014, provides that where an amount deposited by the appellant under section 35F is required to be refunded consequent upon the order of the appellate authority, there shall be paid to the appellant interest at such rate, not below 5% and not exceeding 36% on such amount from the date of payment of the amount till of such amount. It is, therefore, apparent that the amended section 35FF deals with amount that is deposited post 06.08.2014 under section 35F and not to any amount that is deposited under the proviso to the unamended 35F - It is only under the proviso to the unamended section 35F that the amount is determined towards pre-deposit. On the other hand, it is the amended section 35F that requires the appellant to deposit 7.5% of the duty.
In the present case, the amount was deposited by the respondent pursuant to the directions issued under the unamended provisions of the 35F. Such being the position, interest on delayed refund of amount would continue to be governed by the unamended provisions of section 35FF.
It is not in dispute that if the unamended provisions of section 35FF are applicable to the facts of the present appeal, no interest would be payable to the respondent since the amount was refunded within three months from the date of communication of the order.