CESTAT allowed the appeal, holding that when an appellant...

CESTAT allowed the appeal, holding that when an appellant successfully challenges service tax liability, amounts deposited during investigation constitute pre-deposits rather than tax payments, making Section 11B of Central Excise Act inapplicable. The tribunal ruled that refund with interest is automatically payable without requiring separate application filing. The appellant was entitled to interest at 12% per annum from deposit date until refund date, following Supreme Court precedent. The Commissioner (Appeals) erred in rejecting the appeal as non-maintainable since the adjudicating authority had provided specific reasons for denying interest via communication dated 16.02.2023, making the challenge valid. The tribunal emphasized that interest accompanies refunds automatically, with no time limitation for claiming interest when not granted initially.

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