2006 (10) TMI 352

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....ept the value declared by the appellant, they enhanced the same. The appellants were not successful till the CEGAT level. However, the Hon'ble Apex Court held the issue in favour of the appellant. The Revenue invoked the Bank Guarantee worth Rs. 14,72,000/- on 27-8-1997. Consequent to the Supreme Court's order dated November 11, 2003 [2004 (163) E.L.T. 289 (S.C.)], the appellants were entitled for the refund. They filed the refund application on 20-2-2004 and the refund was sanctioned on 8-4-2004. The appellants filed another application for grant of interest on 26-5-2004 for the period from 27-8-1997 to 7-4-2004. The lower authority rejected the application for grant of interest. The appellants appealed to the Commissioner (Appeals). The C....

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....pplication for refund of interest for delayed refund was filed on 26-5-2004. The impugned order is, therefore, vitiated by a patent non-application of mind. " (iii)   It is the case of the appellant that the Apex Court directed the department to pay back to the appellant all the amounts made by it to the department. The said order necessarily carried with it a direction to pay interest on the amount refunded. In the instant case, the Bank Guarantee had been enforced by the department on 27-8-1997 and the refund sanctioned only on 7-4-2004. The excess payment of Rs. 14.72 lakhs effected by the appellant remained in the hands of the department during the aforesaid period. Hence, the appellant was automatically entitled to refund ....

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....lity. Only consequent to Supreme Court's decision, a finality has been reached in the matter and the appellant became entitled for the refund amount. It is seen that the refund claim was filed on 20-2-2004. The department issued an order dated 7-4-2004 for sanctioning the refund amount. In fact, there is not much delay from the date of filing of the refund claim to the date of sanction. However, there is some force in the contention of the learned Advocate that the amount encashed by the Revenue should be considered on par with pre-deposit made under Section 35F of the Central Excise Act/Section 129E of the Customs Act and the benefit of Board's-Circular 8-12-2004 should be given. As per para 4 of the said Board's Circular, in terms of the ....