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2016 (11) TMI 1222 - CESTAT AHMEDABAD

2016 (11) TMI 1222 - CESTAT AHMEDABAD - TMI - Interest on delayed refund - whether the Appellants are eligible to interest on the amount refunded to them viz. ₹ 16,01,260/- and ₹ 81,984/- from 01.7.2000 i.e. the date of adjustment of the said amount from their sanctioned refund amount of Rs. ₹ 68,63,266.51 or from the date after succeeding in the Appellate proceeding, the date on which the amounts became due pursuant to the de novo Orders? - Held that: - A plain reading of the .....

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standing confirmed demand. Subsequently, on challenge of the confirmed demand Order before the Tribunal, the same was set aside resulting into payment of the earlier sanctioned amount adjusted against the said confirmed demand, allowing interest under Sec.11BB from the date of initial sanction of the refund. - Interest is payable at the appropriate rate notified under Sec.11BB of CEA,1944 on the amounts viz. Rs. ₹ 16,01,260/- and ₹ 81,984/- from the date of its appropriation as c .....

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a; since involve a common issue, therefore, taken up together for disposal. However, as the facts are marginally different, accordingly stated Appeal wise. 2. Appeal No.E/837/2009:- Briefly stated the facts of the case are that the Appellants had filed a refund claim for ₹ 69,94,403.31 on 31.08.1998. The said refund claim was adjudicated vide Order No.R/47/2000, dt.30.06.2000 and an amount of ₹ 68,63,266.51 was sanctioned and ₹ 64,824.06 was rejected. However, from the said san .....

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ant filed a refund claim for ₹ 16,01,260/- on 03.10.2007. The said amount was refunded to them vide Order dt.18.12.2007. On 10th Jan.2008, they had filed their claim for interest on refunded amount of ₹ 16,01,260/- from 01.07.2000 to 18.12.2007. Notice was issued on 11.04.2008 proposing rejection of their claim for interest. On adjudication, the said claim was rejected. On appeal, the learned Commissioner (Appeals) upheld the order and rejected their appeal. Hence, the present appeal .....

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oned but their claim for interest from 01.07.2000 to 07.04.2010 was rejected. Aggrieved, they pursued the matter before the learned Commissioner (Appeals), who in turn, rejected their appeal. Hence, the present appeal. 4. The learned Advocate for the Appellant submits that though they filed refund claim on 31.08.1998 and refund was sanctioned on 30.06.08, but the amount of ₹ 19,42,149.79 was wrongly adjusted/deducted from the legitimate sanctioned refund claim against the outstanding deman .....

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ibunal in the case of Super Casettes Industries Vs CCE Noida - 2007-TIOL-2287-CESTAT-Del, Jubilant Organosys Ltd Vs CCE Meerut - 2014 (301) ELT 542 (Tri-Del), Pet Metal P. Ltd Vs CCE Vadodara-II - 2015-TIOL-2047-CESTAT-AHM, CCE Kanpur Vs Kothari Products Ltd - 2010 (262) ELT 329 (Tri-Del). 6. Per Contra, the learned Authorized Representative for the Revenue reiterated the findings of the learned Commissioner (Appeals). The learned Authorized Representative submitted that in view of the provision .....

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came due pursuant to the de-novo order dt.8.8.2007; the Appellant filed the refund of the said amount on 10.10.2007 and it was sanctioned to them on 18.12.2007 i.e. within three months from the date of filing of the refund consequent to the de-novo adjudication order. Therefore, no interest is payable to the Appellant against the refund of ₹ 16,16,262/-. He has further submitted that in relation to other amount ₹ 81,984/- which was also due on re-quantification by order dt.4.12.2009, .....

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mount refunded to them viz. ₹ 16,01,260/- and ₹ 81,984/- from 01.7.2000 i.e. the date of adjustment of the said amount from their sanctioned refund amount of Rs. ₹ 68,63,266.51 or from the date after succeeding in the Appellate proceeding, the date on which the amounts became due pursuant to the de novo Orders. The contention of the Appellant is that even though the refund was sanctioned on 30.06.2000, it was wrongfully adjusted against the outstanding demand confirmed by anoth .....

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ny difference. Before addressing the controversy, it is necessary to refer to the relevant provisions viz. Section 11BB which reads as under:- Section 11BB. Interest on delayed refunds. - If any duty ordered to be refunded under sub-section (2) of Section 11BB to any applicant is not refunded within three months from the date of receipt of application under sub-section (1) of that section, there shall be paid to that applicant interest at such rate, not below five per cent and not exceeding thir .....

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sent of the President, is not refunded within three months from such date, there shall be paid to the applicant interest under this section from the date immediately after three months from such date, till the date of refund of such duty. Explanation. Where any order of refund is made by the Commissioner (Appeals), Appellate Tribunal, National Tax Tribunal or any court against an order of the Assistant Commissioner of Central Excise or Deputy Commissioner of Central Excise, under sub-section (2) .....

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Ltd (supra) confronted with a similar question under more or less identical circumstances, where under after sanctioning rebate claim, the adjudicating authority instead of making payment of the same, adjusted it against the outstanding confirmed demand. Subsequently, on challenge of the confirmed demand Order before the Tribunal, the same was set aside resulting into payment of the earlier sanctioned amount adjusted against the said confirmed demand. Allowing interest under Sec.11BB from the d .....

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immediately but the date of passing of the Tribunal s order cannot be considered to be relevant date for the purpose of interest. In terms of the provisions of Section 11BB of Central Excise Act, 1944 if the refund claims filed are not sanctioned within three months, the Revenue is under legal obligation to pay till interest till the date the same are actually given to the assessee. As such, in terms of the said provisions of law, the interest liability of the Revenue would start running from th .....

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