Excise refund interest accrues only after three months' delay from the refund application, not from the original deposit.

Statutory interest on excise refund under Section 11BB accrues only when a refund claim under Section 11B is not sanctioned within three months of receipt of the refund application. Where the refund was sanctioned within three months of the application, the statutory condition for interest was not met, and interest from the date of deposit was also unavailable because the deposit was not shown to have been made under protest.

---

---

Issues: Whether interest on the refund amount was payable from the date of deposit till the date of refund.

Analysis: Interest on refund is governed by Section 11BB of the Central Excise Act, 1944, which becomes operative only when a refund claimed under Section 11B is not sanctioned within three months from the date of receipt of the refund application. The refund application was filed after the order allowing refund and the refund was sanctioned within three months of that application. In such circumstances, there was no delay in processing the refund and the statutory condition for payment of interest was not satisfied. The claim for interest from the date of deposit was also not accepted, as the deposit was not shown to have been made under protest.

Conclusion: Interest from the date of deposit was not payable. The issue is decided against the assessee.

Ratio Decidendi: Statutory interest on refund under Section 11BB of the Central Excise Act, 1944 is payable only if the refund is not granted within three months from the date of the refund application under Section 11B.

---