TaxTMI 
TaxTMI 
Is the circular granting 6% interest as per Sec 35FF on refund of pre-deposit binding on the department or Tribunal?
Can interest be claimed at 12%?
Any case laws?
Experts pls advice
refund of deposit in service tax
07 Jul 2023 
5 Replies 
1640 Views Asked by
Interest on tax refunds: prescribed statutory rate binds claims; higher judicial rates require exceptional administrative delay.
The text addresses whether claimants can obtain interest at a higher rate than the rate prescribed by statute and executive instruction on refunds of pre-deposits in service tax. It explains that the prescribed rate is the normal entitlement and that executive circulars are binding on the department, while higher interest has been awarded by courts only in exceptional cases of serious departmental delay or fault. Thus, claimants cannot as of right demand a higher rate absent adjudicated grounds showing administrative culpability. (AI Summary)
The text addresses whether claimants can obtain interest at a higher rate than the rate prescribed by statute and executive instruction on refunds of pre-deposits in service tax. It explains that the prescribed rate is the normal entitlement and that executive circulars are binding on the department, while higher interest has been awarded by courts only in exceptional cases of serious departmental delay or fault. Thus, claimants cannot as of right demand a higher rate absent adjudicated grounds showing administrative culpability. (AI Summary)