Rate of interest on refund of pre-deposit fixed at 6% by statutory notification, appeal dismissed enforcing that rate.

Rate of interest on refund of pre-deposit must follow the statutory notification fixing the rate at 6% per annum; the tribunal applied the Delhi High Court reasoning that a notification issued under the customs/central excise refund scheme is binding and limits the discretion to award higher rates. The tribunal rejected contrary precedents as inapplicable where either the refund was denied or the 2014 notification was not considered, and found delay allegations immaterial to altering the statutory rate. Consequent order upholds the impugned order and dismisses the appeal.

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Issues: Whether the amount deposited by the appellant as pre-deposit during the pendency of their appeal, after appropriation of confirmed duty and penalty, ought to be refunded with interest at the rate of 12% per annum from the date of deposit until disbursal.

Analysis: The dispute is confined to the rate of interest payable on the refunded pre-deposit. The statutory scheme and notifications issued under provisions governing interest on deposited duty (including Notification No. 67/2003-CE and Notification No. 70/2014 issued under the provisions corresponding to Section 11B/11BB of the Central Excise Act and Section 129EE of the Customs Act) fix the rate of interest to be applied. Prior authorities, including High Court and Tribunal decisions, have held that where deposits relate to duty/tax, the rate specified by the relevant notification must be applied. The Tribunal noted that the Commissioner (Appeals) granted interest from date of deposit to disbursement but adopted the rate prescribed by Notification No. 70/2014 (6%). The appellant's reliance on decisions awarding higher interest was distinguished on facts and on non-application or non-consideration of the 2014 notification in those decisions. The Tribunal observed it is bound by the statutory notifications prescribing the rate and found no basis to alter the rate to 12%.

Conclusion: The impugned order awarding interest at 6% per annum is upheld and the appellant's claim for interest at 12% is rejected; the appeal is dismissed (decision against the appellant and in favour of the revenue).

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