2017 (3) TMI 566

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..... ctioned in terms of appellate order by the Commissioner (Appeals). Thereafter,  the appellant sought payment of interest towards delayed disbursement of refund in terms of Section 11BB of the Central Excise Act, 1944, made applicable to the provision of Finance Act, 1994. The Original Authority rejected their request for interest on the ground that the provision of Section 11B and Section 11BB are not applicable to the refund claim under the above said notifications. On appeal vide the impugned orders the Commissioner (Appeals) held that the provision of Section 11BB are applicable to the case in hand. However, he held that there isno delay in sanction of refund considering the date of letter issued by the appellant to the Jurisdiction .....

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..... tion 11B. Further, I also note that the learned Commissioner (Appeals) referred to the provision of Clause (ec) under Explanation B to Section 11B. The said provision is relating to consequential refund arising out of an appellate order. In the present case, I note that the refund claim has not arisen consequential to any appellate order. The appellate order only decides the correctness of the claim already filed and rejected by the Original Authority. This cannot be considered as a refund consequent on an appellate order. Further, the refund amount paid is with reference to the original application for refund filed by the appellant. A reference can also be made to the decision of Hon'ble Supreme Court in the case of Ranbaxy Laboratories Lt .....

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..... the amount claimed is still not refunded. Thus, the only interpretation 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. ............. 15. In view of the above analysis, our answer to the question formulated in para (1) supra is that the liability of the revenue to pay interest under Section 11BB of the Act commences from the date of expiry of three months from the date of receipt of application for refund under .....

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