Court upholds interest entitlement under Central Excise Act despite jurisdiction changes post CGST. Revenue appeal dismissed.

The Court upheld the entitlement of the respondent to interest on delayed refund under the Central Excise Act, 1944, despite jurisdiction changes post the introduction of the new CGST regime. The appeal by the Revenue was dismissed, and the Court ordered the Income-tax Department to pay simple interest at 9% per annum from the due date till actual payment, emphasizing compensation for the delay. The Court found no merit in the appellant's arguments and ruled in favor of the respondent, emphasizing adherence to legal precedents.

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Issues:
1. Entitlement of interest for refund from the date of deposit.
2. Dismissal of rectification of mistake application by appellant.
3. Change in jurisdiction post introduction of new CGST regime.
4. Granting of interest under amended provisions of Section 35FF of the Central Excise Act, 1944.

Issue 1: Entitlement of interest for refund from the date of deposit:
The respondent applied for central excise duty and interest refund, which was partially allowed by the Deputy Commissioner, Central Excise, Division Panipat. The Commissioner of Central Excise (Appeals) and CESTAT also ruled in favor of the respondent's entitlement to interest on delayed refund. The Revenue filed appeals against these orders. The Counsel for the Revenue raised questions regarding jurisdiction changes post the new CGST regime. However, the Court held that the claim for refund was filed before the new Act came into force, and thus, the jurisdiction change due to the GST regime did not affect the appellant's plea.

Issue 2: Dismissal of rectification of mistake application by appellant:
The appellant filed a rectification of mistake application before CESTAT, which was subsequently dismissed. The Revenue appealed against this decision. The Court found no merit in the arguments raised by the Counsel for the appellant and dismissed the appeal, upholding the decision of the Tribunal.

Issue 3: Change in jurisdiction post introduction of new CGST regime:
The Counsel for the Revenue argued that the respondent impleaded wrong authorities for the claim of refund and interest due to the change in jurisdiction post the introduction of the new CGST regime. The Court, however, held that the provisions of the existing law, i.e., the Central Excise Act, 1944, governed the claim for refund, and the transfer of jurisdiction due to the GST regime was not applicable to the appellant's case.

Issue 4: Granting of interest under amended provisions of Section 35FF of the Central Excise Act, 1944:
The Counsel argued that the Tribunal erred in granting interest as per the amended provisions of Section 35FF of the Central Excise Act, 1944. The Court referred to the law laid down by the Supreme Court in Sandvik Asia Ltd vs. CIT, Pune, and held that the appellant was entitled to interest on delayed refund. The Court ordered the Income-tax Department to pay simple interest at the rate of 9% per annum from the date it became payable till the date of actual payment, emphasizing the need for compensation for the delay in refund.

In conclusion, the Court dismissed the appeal, finding no merit in the arguments presented by the appellant. The judgment emphasized the entitlement of the respondent to interest on delayed refund and the applicability of the law laid down by the Supreme Court in similar cases.

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