Interest on Pre-Deposits

[Adarsh Gupta]

Sir's,

I understand that an amendment was made vide Finance (No. 2) Act, 2014, to S 35FF of CEA, 1944 for grant of interest for the period from the date of deposit to the date of payment.

Also a proviso was inserted wherein 'the amount deposited under section 35F, prior to the commencement of the Finance (No. 2) Act, 2014, shall continue to be governed by the provisions of section 35FF as it stood before the commencement of the said Act'.

Accordingly as i understand that the interest on amount deposited prior to this amendment shall be for the period where the refund is not granted within 3 months from the decision in favor of the assessee. Which means that Lets say if an amount was deposited in 2005 and matter got decided in companies favor in 2019 and refund is issued within 3 months of such decision, no interest would be payable.

Is my understanding correct? Further isn't it unfair to keep taxayers money for 14 years without giving any interest? Can this be challenged? Any Case law in support.

Regards,

ADARSH GUPTA

AI Summary

Forum Debate on Interest for Pre-Amendment Deposits Under Section 35FF of Central Excise Act, 1944 A discussion on a forum addresses the issue of interest on pre-deposits under the amended Section 35FF of the Central Excise Act, 1944, as per the Finance (No. 2) Act, 2014. The amendment stipulates that interest is granted from the deposit date to the payment date, but amounts deposited before the amendment follow the old provisions. One participant questions the fairness of not paying interest on prolonged deposits. Responses highlight the legal framework, referencing case laws and government circulars, and suggest that interest should be paid on refunds following favorable appellate decisions within a specified timeframe.