2012 (8) TMI 472 - AT - Central Excise

CESTAT Chennai: Interest on delayed refund payment allowed after 3 months from filing

The Appellate Tribunal CESTAT, Chennai, ruled in favor of the appellants, stating they are entitled to interest on delayed payment for the sanction of ... Entitlement of interest on delayed payment for sanction of refund of the rebate claim by the adjudicating authority - revenue contending that appeal regarding rebate claim is not maintainable before this Tribunal - Held that:- Since it is a case of interest on rebate claim and the same is maintainable before this Tribunal. Further, Supreme Court held in case of Ranbaxy Laboratories Ltd. Vs. UOI (2011 (10) TMI 16 - SUPREME COURT OF INDIA) that interest has to be paid on delayed sanction of refund claim after three months of the date of filing of the refund claim. Therefore, the issue is no more res integra. The appellants are entitled for interest on delayed sanction of rebate claim. Appeal allowed in favor of assessee. Issues:Entitlement to interest on delayed payment for the sanction of refund of the rebate claim.Analysis:The judgment by the Appellate Tribunal CESTAT, Chennai, addressed the issue of whether the appellants are entitled to interest on delayed payment for the sanction of refund of the rebate claim. The learned DR contended that the appeal regarding the rebate claim is not maintainable before the Tribunal. However, the Tribunal referenced its previous decision in the appellant's case where it was established that interest on delayed payment of rebate claim falls within the jurisdiction of the Tribunal. Citing the precedent set by the Hon'ble Supreme Court in the case of Ranbaxy Laboratories Ltd. Vs. UOI, the Tribunal affirmed that interest must be paid on delayed sanction of refund claims after three months from the date of filing. Consequently, the Tribunal rejected the objection raised by the learned DR and ruled in favor of the appellants, stating that they are indeed entitled to interest on the delayed sanction of the rebate claim. The judgment was pronounced in open court, and the appeals were disposed of with consequential relief.This judgment highlights the significance of interest entitlement on delayed payment for the sanction of refund of the rebate claim. It underscores the Tribunal's authority to adjudicate on such matters, as established through both its own precedent decisions and the binding precedent set by the Hon'ble Supreme Court. The ruling provides clarity on the legal obligation to pay interest in cases of delayed sanction of refund claims, ensuring that appellants are rightfully compensated for any delays in the process. The judgment serves as a reminder of the legal principles governing refund claims and sets a precedent for similar cases in the future.