Pre-show-cause consultation and remand limits govern refund disputes, with statutory interest under refund law remaining payable.

An assessment order was found procedurally flawed because no pre-show-cause consultation or personal hearing was afforded, and the adjudicating authority went beyond the limited remand by reopening issues not remitted for reconsideration. The remand had been confined to the cess refund reason and interest on the already sanctioned refund, so findings on short payment were outside jurisdiction. The article also notes that excess tax and cess paid were refundable where the amounts and challans were undisputed, and statutory interest under Section 11BB of the Central Excise Act, 1944 could not be defeated by a prior waiver or estoppel against the statute.

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Issues: (i) Whether the impugned show-cause notice and order were vitiated for want of pre-show cause consultation, denial of personal hearing, and for travelling beyond the scope of remand; (ii) Whether the petitioner was entitled to refund of the excess tax and cess paid, along with interest under Section 11BB of the Central Excise Act, 1944.

Issue (i): Whether the impugned show-cause notice and order were vitiated for want of pre-show cause consultation, denial of personal hearing, and for travelling beyond the scope of remand.

Analysis: The record showed that no consultation notice preceded issuance of the show-cause notice and that no personal hearing was granted before the order was passed. The appellate remand had been confined to two specific matters: the reason for denial of refund of the cess component and the question of interest on the refund already sanctioned. Instead, the adjudicating authority reopened the entire assessment and proceeded to record short payment findings, which was beyond the remand directions.

Conclusion: The impugned proceedings were procedurally flawed and the order exceeded the scope of remand.

Issue (ii): Whether the petitioner was entitled to refund of the excess tax and cess paid, along with interest under Section 11BB of the Central Excise Act, 1944.

Analysis: The amounts deposited and the relevant period were not in dispute. The authority did not furnish any acceptable reason for withholding the actual excess amount paid towards tax and cess. As regards interest, the statutory scheme under Section 11BB makes interest payable after expiry of the prescribed period, and a prior statement not to claim interest could not operate as an estoppel against the statute. The petitioner had also produced the challans, making the refund verifiable.

Conclusion: The petitioner was entitled to refund of the excess amount and to statutory interest on the refund amounts.

Final Conclusion: The writ petition succeeded, and the petitioner obtained refund-related reliefs together with statutory interest, with the impugned order not being sustained.

Ratio Decidendi: Where the remand is confined to specified issues, the adjudicating authority cannot reopen the entire assessment; statutory interest on refund cannot be defeated by waiver or estoppel where the statute mandates payment.

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