2022 (5) TMI 795 - AT - Central Excise

Appellant entitled to refund claim with interest; Tribunal clarifies revenue deposit, interest rates, and refund provisions.

The Tribunal held that the appellant is entitled to a refund claim of the amount deposited during the investigation, along with interest at 12% from the ... Refund alongwith interest - relevant date for calculation of interest - the entitlement of claiming the said amount along with the interest shall reckon from the date of said Final Order or from the date of deposit? - HELD THAT:- It is observed that admittedly the amount, the refund whereof was claimed, was deposited at the time when audit of the appellant was got conducted by the department. Admittedly, even the show cause notice was not issued to the appellant. The impugned Final order has discussed the findings of Hon’ble Delhi High Court in the case of DIGIPRO IMPORT & EXPORT PVT. LTD. VERSUS UNION OF INDIA & ORS. [2017 (5) TMI 759 - DELHI HIGH COURT] wherein the conduct of audit team to collect duty at the initial stage is not authorised by any law in force and hence is held illegal. The appellant is entitled for the refund claim of the amount deposited on 09.07.2018 during investigation along with interest @12% on the aforesaid demand to be calculated from the said date of deposit - application allowed. Issues involved:Entitlement to claim refund along with interest from the date of deposit vs. date of Tribunal's final order.Analysis:The appellant sought a refund along with interest @ 12% from the date of deposit, relying on a previous decision. The Department argued that refund entitlement arises only after the Tribunal sets aside the demand, hence interest should start from the date of the final order. The Tribunal noted that the duty was deposited during an unauthorized audit, citing a Delhi High Court decision and the provisions of the Excise Act. It clarified that the appellant claimed a refund of the revenue deposit, not duty, and endorsed the findings of a previous case regarding interest rates and refund provisions.The Tribunal referenced a Bangalore Bench decision where a similar refund claim was accepted, emphasizing that deposits made under protest during investigations are eligible for refunds. Consequently, the Tribunal held that the appellant is entitled to the refund claim of the amount deposited during investigation, along with interest @12% from the date of deposit. The miscellaneous application was allowed based on this clarification in the final order.