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2016 (3) TMI 305 - CESTAT NEW DELHI

2016 (3) TMI 305 - CESTAT NEW DELHI - 2016 (339) E.L.T. 120 (Tri. - Del.) - Interest on delayed payment of interest - Held that:- Regarding the interest, we find that for the first time the legal provision for payment of interest on refund was introduced in the law only on 26.05.1995 through Finance Act, 1995. In the absence of any provision prior to that date the appellants plea for payment of interest for the prior period cannot be sustained. Similarly, we find that there is no provision for .....

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ind in the present case the appellants are operating under small scale exemption scheme and it is recorded that in the end of the year they are reversing the available credit in their books in order to avail SSI exemption. Considering this position, granting refund and crediting it to the modvat account will not in effect allow the appellant to utilize the fund which was collected and kept by the Government in excess of legal due. Under these circumstances, we find the refund sanctioned already .....

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ts are engaged in the manufacture of oxygen and ethylene gas liable to Central Excise Duty. They are availing small scale exemption in terms of Notification No.175/86. There was an excess payment of duty by the appellants in the year 1988-89. The appellant filed claim for refund on 06.10.1989. The refund was sanctioned by the Original Authority vide order dated 08.12.2005. Out of total refund of ₹ 8,26,996/-, an amount of ₹ 5,77,580/- was paid by Cheque and an amount of ₹ 2,49, .....

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y this order, the present appeal has been filed. 2. The ld. Counsel for the appellant submitted that the amount claimed as refund has been collected and retained by the Department without the authority of law and the same has to be restored back to the appellant with the interest. It is applicable from the date of such improper recovery. She also submitted that they are eligible for interest on the delayed payment of interest. Further, the refund in full should have been given to them by cash, a .....

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. It has been rightly upheld in the impugned order. There is no legal provision to pay of interest on interest. Regarding the part of the refund amount being credited in the cenvat account, the ld. A.R. submitted that since the amount was remitted by the appellant by using credit, the refund was also sanctioned by re-credit of such account. He submitted that there is no legal infirmity in such action. 4. We have heard both sides and examined appeal records. Regarding the interest, we find that f .....

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