Interim release of deposited refund amount allowed subject to bank guarantee and security while remanded VAT dispute remained pending.

Deposited refund amounts were directed to be released to the petitioner while the VAT Department's appeal remained pending on limitation and merits after remand. The court found continued retention of the money unnecessary because the earlier order had not been finally displaced, but it protected the revenue by conditioning release on a bank guarantee, indemnity bond and other acceptable security. The operative effect was interim restitution to the claimant, balanced against safeguards preserving the department's interests during fresh adjudication.

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Issues: Whether the amounts lying in court should be refunded to the petitioner pending adjudication of the VAT Department's appeal on limitation and merits.

Analysis: The earlier directions to deposit the refund amount were reconsidered in light of the Supreme Court's partial interference and remand, which left the VAT Department's appeal open on limitation as well as merits. Since the Tribunal's order had not been set aside and the dispute was to be re-examined, continued retention of the deposited amount was found unnecessary. At the same time, the Court protected the revenue interest by requiring the petitioner to furnish bank guarantee and indemnity/security before release of the money.

Conclusion: The deposited amount was ordered to be refunded to the petitioner subject to furnishing the stipulated bank guarantee, indemnity bond, and other acceptable security.

Final Conclusion: The petitioner obtained release of the deposited refund amount, but only against safeguards securing the revenue's interest during the pending adjudication.

Ratio Decidendi: Where a refund-related dispute is remanded for fresh consideration and the earlier order has not been finally displaced, the court may direct release of the deposited amount to the claimant on appropriate security to balance interim restitution with protection of the revenue.

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