TMI Blog2015 (11) TMI 1159X X X X Extracts X X X X X X X X Extracts X X X X ..... 20-11-2015 - Dr. D.M. Misra, Member(Judicial) For the Petitioner : Shri Kartik Kurmi, Advocate Shri S.B.Sharma, Advocate For the Respondent : Shri A.K.Biswas, Supdt.(AR) ORDER Per Dr. D.M. Misra. 1. This Appeal is directed against Order-in-Appeal No.19/RAN/2008 dated 04.02.2008 passed by the Commissioner(Appeals) of Central Excise Service Tax, Ranchi. 2. Briefly stated facts of the case are that the Appellant had filed four refund claims during the period July, 1994 to April, 1995 under Rule 57F of the erstwhile Central Excise Rules, 1944. After protracted litigation, ultimately they became eligible to the refund, pursuant to the Orders of This Tribunal. The refund claims were finally settled and paid by the sanctioning authority. Consequently, the appellant had filed a claim for interest, initially on 25.03.2002, under section 11BB of the Central Excise Act, 1944 amounting to ₹ 36,67,461/-, which later revised to ₹ 37,28,253/- on 10.08.2002 shown as below: S.No. Amount of refund claim (Rs.) Date of submission of refund claim Date of sanction of refund claim ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... AT and not from the date of filing of the claims.. 5. It is his contention that the principle of law on the above issues has been settled and therefore interest on delayed refund is admissible to them. On the issue of applicability of section 11BB of CEA1944 to to MODVAT credit refunds, the ld. Advocate referred to the judgement of the Hon ble Gujarat High Court in the case of Commissioner of Central Excise vs. Reliance Industries Ltd. -2010 (259) ELT 356(Guj.) which has been upheld by the Honble Supreme Court reported as Commissioner vs. Reliance Industries Ltd. - 2011 (274) ELT A-110(SC). Also, similar opinion has been expressed by the Hon ble Madras High Court in the case of Commissioner of Central Excise, Salem vs. Rajalakshmi Textile Processors (P) Ltd. - 2008 (221) ELT 38(Mad.) and Hon ble Uttarakhand High Court in the case of Rishabh Velveleen Ltd. vs. CESTAT - 2014 (305) ELT 386(Uttarakhand). On the issue of applicability of section 11BB to the refund claims pending and filed prior to 26.05.1995, the ld.Advocate referred to the decision of Hon ble Rajasthan High Court in the case of J.K.Cement Works vs. Asstt. Commissioner of Central Excise Customs - 2004 (170) ELT 4 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 4, the Hon ble Gujrat High Court taking into consideration the Circular No.130/41/95-CX dt,30.091995 issued after insertion of Sec.11BB referring to erstwhile Rule 57F erstwhile Central Excise Rules,1994, in Reliance Industries Ltd s case(supra) observed as: 12. On the facts and in the circumstances of the present case, admittedly the refund has been ordered under Rule 5 of the Rules and there was a delay in sanctioning the refund, in the circumstances, the provisions of Section 11BB of the Act would clearly be attracted and as such the Tribunal was justified in holding that the provisions of clause (c) of the proviso to sub-section (2) of Section 11B and consequently Section 11BB of the Act are clearly applicable to the facts of the present case and as such the respondent is entitled to interest on delayed refund of Cenvat Credit as claimed by it. 13. Another aspect of the matter is that when Section 11BB of the Act had newly been inserted by the Finance Act, 1995, the Government of India, Ministry of Finance (Department of Revenue) has issued Circular : 130/41/95-CX., dated 30th May, 1995 (which finds reference in the impugned order of the Tribunal) issuing instructions ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... three months of the date of receipt of application required to be made under Section 11B(1). The rate of interest is to be prescribed by the Board and the interest is payable with effect from the date commencing from the expiry of three months from the date of receipt of such application till the refund of such duty. 22. The proviso to Section 11BB also takes care of the cases where refund became due prior to the insertion of proviso but the refund has not been paid until the insertion of Section 11B. In such event the date with effect from which liability to pay interest runs is with effect from the date of the expiry of three months from the date of the receipt of the assent of the President to the Finance Bill 1995, as the provision in the Bill became Act on 26-5-95. If the amount of refund claim was pending at the date of commencing of the new provisions and were not to be paid by 25-8-95, the Revenue became liable to pay interest w.e.f. 26-8-95 until the date of actual payment. 23. The scheme of payment of interest on belated payment of refund under the Central Excise Act, 1944 is one integrated within the provisions of Section 11B and 11BB. They have to be read t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ave noticed above that prior to insertion of Section 11BB there was no statutory provision providing for interest on refund of amount of excess Duty if not paid within a specified date, there is no statutory provision providing for interest on non refund of amount of excess duty within a specified period or on specified date until insertion of Section 11BB. In the absence of any statutory provision for payment of interest no mandamus could be issued for payment of interest for the period prior to one provided in Section 11BB. 41. However, Proviso to Section 11BB which makes the provision applicable to pending applications if the refund amount is not paid within three months from the date Finance Bill received assent of the President, the entitlement of the petitioner to claim refund from such date cannot be denied to him. 42. Accordingly the petition is allowed, the respondents are directed to pay interest on the amount of refund ordered to be paid to the applicant under sub-section 2 of Section 11B with effect form the expiry of three months from the date Section 11BB came into force that is to say w.e.f. 26-5-1995 which is the date of expiry of three months from 26-5-19 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nterpretation of Section 11BB that can be arrived at is that interest under the said Section becomes payable on the expiry of a period of three months from the date of receipt of the application under sub-section (1) of Section 11B of the Act and that the said Explanation does not have any bearing or connection with the date from which interest under Section 11BB of the Act becomes payable. 13. In view of the above analysis, the Appellant are entitled to the claim of interest on delayed refund of CENVAT Credit on the four applications filed between 25.07.1994 and 28.04.1995. From the table mentioned as above it seems that the interest amount against the delayed refund claims were calculated taking the date of filing of such claims as the relevant date. However, for pending refund claims as on 26.05.1995, the date of enactment of Sec.11BB, the payment of interest shall be computed in accordance with proviso to Sec. 11BB i.e from 26.08.1995 and not from the date of application of refund in view of the judgment of Hon ble Rajastan High Court in J.K.Cement Works Case(supra). Thus, the case is remanded to adjudicating authority only for the limited purpose of verification/computat ..... X X X X Extracts X X X X X X X X Extracts X X X X
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