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Karnataka HC Orders Interest Payment on Delayed Refunds, Quashes Respondent's Communication; 2-Month Compliance Deadline. The HC of Karnataka allowed the writ petition, quashing the impugned communication by Respondent No. 2. The court directed the respondents to pay interest ...
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Karnataka HC Orders Interest Payment on Delayed Refunds, Quashes Respondent's Communication; 2-Month Compliance Deadline.
The HC of Karnataka allowed the writ petition, quashing the impugned communication by Respondent No. 2. The court directed the respondents to pay interest on the delayed refund as per Section 11BB of the Central Excise Act, 1944, after due verification. Compliance is mandated within two months from the judgment date.
Issues involved: The petitioner sought a writ of mandamus to direct the Respondent No. 2 to accept the claim for interest on a delayed refund and adjudicate the matter following due procedure according to Section 11BB of the Central Excise Act, 1944. The petitioner also requested other appropriate relief, costs of the petition, and any other fitting order or direction.
Summary of Judgment:
Issue 1: Claim for interest on delayed refund
The petitioner submitted an application for refund of interest on delayed receipt of Service Tax refund from May 2008 to June 2017 as per Section 11BB of the Central Excise Act, 1944. The respondents erroneously stated that the question of interest would be dealt with during adjudication proceedings, leading the petitioner to file a petition seeking interest on the delayed refund. The court found that the petitioner was entitled to interest for the delayed refund as per Section 11BB of the Act. The court set aside the erroneous communication from the respondents and directed them to grant interest on the delayed refund after due verification within a stipulated time frame.
In conclusion, the High Court of Karnataka allowed the writ petition, quashed the impugned communication issued by Respondent No. 2, and directed the respondents to pay interest on the delayed refund as requested by the petitioner after verification, to be completed within two months from the date of the judgment.
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