Interest on delayed excise refund must run from expiry of three months after refund application, petition granted.

Interest on delayed excise refunds is payable from the day after the expiry of three months from the date of the refund application where the claim is not processed within that period; this rule follows the binding precedent cited. The revenues contention that interest should run from three months after the appellate order was rejected, and the adjudicating authoritys treatment of a subsequent letter as the application date was found erroneous. Consequently the claim for interest was sustained and the petition allowed.

---

---

Issues involved:
The petitioner challenges the denial of interest on refund under Section 11BB of the Central Excise Act, 1944 and Section 83 of the Finance Act in a case involving export of services. The primary contention is the calculation of interest on the refund amount.

Details of the judgment:

Issue 1: Denial of interest on refund amount
The petitioner, engaged in providing services to an overseas entity, filed applications for refund of unutilised Cenvat Credit for different tax periods. The Adjudicating Authority initially rejected the claim on the ground that the services were provided as an intermediary in India. The petitioner appealed to various authorities, ultimately succeeding before the CESTAT. However, the claim for refund was not processed promptly. The Adjudicating Authority later granted the refund but denied interest, citing that the claim was processed within three months of the petitioner's letter seeking refund. The court held that interest on refund should be calculated from the date immediately after the expiry of three months from the dates of the original refund applications, not from the date of the appellate orders. The Adjudicating Authority erred in considering the petitioner's letter as the refund application. The court directed the Authority to process the petitioner's claim for interest in accordance with the law.

Conclusion:
The court allowed the petition, directing the Adjudicating Authority to process the petitioner's claim for interest under Section 11BB of the Excise Act and Section 83 of the Finance Act from the correct dates of the original refund applications.

---