Pre-deposit refund interest starts when appeal succeeds; refund-form filing cannot delay accrual of interest.

A pre-deposit made solely to pursue an appellate remedy is not tax or duty payment, and the refund entitlement crystallises when the appeal succeeds. The Delhi HC held that filing a refund form is only a procedural requirement for administrative convenience and cannot postpone the commencement of interest on the refunded amount. Interest was therefore payable from the date the assessee's appeal was allowed, not from the later date of refund-form filing, and the authorities were directed to process and credit the interest accordingly.

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Issues: Whether interest on the refund of pre-deposit amounts is payable from the date the appeal was allowed, and whether filing of the refund form could postpone the date from which interest became due.

Analysis: The amount paid by the assessee during the appeal process was a pre-deposit made to avail appellate remedy and did not bear the character of tax. The requirement of filing a refund form was only procedural and for administrative convenience. Such a procedural step could not govern or postpone the accrual of interest where the entitlement to refund arose on the success of the appeal. The reasoning adopted in decisions holding that pre-deposit is not payment of duty or tax and must be refunded with interest upon success in appeal supported this conclusion.

Conclusion: Interest on the refunded pre-deposit was payable from the date the assessee's appeal was allowed, and not from the later date on which the refund form was filed.

Final Conclusion: The assessee was held entitled to interest on the refund from the date of the appellate allowance of its claim, and the authorities were directed to process and credit the amount accordingly.

Ratio Decidendi: A pre-deposit made solely to pursue an appeal is not tax payment, and procedural refund formalities cannot defer the commencement of interest once the underlying refund entitlement crystallises on success in appeal.

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