Statutory interest rate on pre-deposit cannot be raised on equity when the governing provision fixes the rate.

A deposit made during investigation was treated as a pre-deposit for interest purposes under the statutory scheme, and interest was already granted in line with Section 35FF of the Central Excise Act, 1944 and the relevant notification. As no challenge was raised to the validity of the provision or the notification fixing the interest rate, the Court noted that its appellate jurisdiction under Section 35G is limited to substantial questions of law and cannot be used to substitute a higher rate on equitable grounds. The assessee was therefore not entitled to interest above 6% per annum, and no substantial question of law arose.

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Issues: Whether the assessee was entitled to interest on the refunded deposit at a rate higher than 6% per annum, instead of the statutory rate under Section 35FF of the Central Excise Act, 1944 read with the notification issued thereunder.

Analysis: The amount deposited during investigation was treated as a pre-deposit for the purposes of Section 35FF of the Central Excise Act, 1944 and interest had already been granted in accordance with the statutory mechanism and Notification No. 24/2014-C.E. (N.T.) dated 12.08.2014. No challenge was laid to the validity of the statutory provision or the notification prescribing the rate of interest. The appellate jurisdiction under Section 35G of the Central Excise Act, 1944 is confined to substantial questions of law, and where the statute itself provides both the right to interest and the applicable rate, the Court cannot substitute a higher rate on equitable considerations.

Conclusion: The assessee was not entitled to interest above the statutory rate of 6% per annum, and no substantial question of law arose.

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