Double refund by suppression attracts interest and mandatory penalty once material facts were concealed.

Double availment of refund by suppressing an earlier suo motu credit entry in the PLA attracts recovery of the wrongly refunded amount with interest. Where the second refund application omits disclosure of the prior credit and the assessee encashes the duplicate refund, the conduct constitutes suppression of material facts and supports the statutory penalty for fraud, suppression or wilful misstatement. On these facts, the penalty is mandatory once the requisite ingredients are established, and there is no basis to reduce it below the amount determined.

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Issues: Whether interest and penalty were leviable on amounts of refund wrongly availed twice by the appellant by suppressing the earlier suo motu credit entry and thereby attracting the provisions governing erroneous refund, interest and mandatory penalty.

Analysis: The appellant had already taken refund of the amounts by making suo motu credit entries in the PLA, but later filed refund applications without disclosing that earlier availment and thereafter encashed the cheques issued on the second set of applications. The omission to disclose the earlier refund constituted suppression of material facts, and the conduct showed deliberate double availment of the same refund. On those established facts, the liability to repay the wrongly refunded amounts with interest arose under the provision governing interest on such amounts, and the conditions for imposition of penalty under the provision prescribing penalty for fraud, suppression or wilful misstatement were satisfied. In such a case, there was no scope to restrict the penalty below the amount determined, because the statutory penalty operated once the requisite ingredients were established.

Conclusion: Interest and penalty were rightly imposed, and the appellant's challenge failed.

Ratio Decidendi: Where refund is obtained twice by concealment of the earlier refund and suppression of material facts, the amount is recoverable with interest and the mandatory penalty provision applies.

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