TaxTMI 
TaxTMI 
2016 (4) TMI 291
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.... payment and also for paying interest on interest of Rs. 5,40,094/- for the period from 10.03.2010 to 10.11.2010. 2. The petitioner Company is engaged in providing advertising services, which is taxable service under the provisions of the Finance Act, 1994 (hereinafter referred to as "the Act") as amended from time to time and is discharging service tax liability under the said Act. The petitioner company has been registered as an assessee and is a service provider with the Service Tax Department. The petitioner Company paid excess service tax to the tune of Rs. 42,68,686/- for the advertising services provided by them during April 2003 to November 2004. On 24.01.2005, the petitioner Company filed a refund claim of Rs. 42,68,686/- with the third respondent - Assistant Commissioner of Service Tax, Division-1, Ahmedabad. A show cause notice dated 21st March, 2005 came to be issued to the petitioner Company proposing to reject the refund claim on the grounds of time-bar and unjust enrichment. The Assistant Commissioner of Service Tax passed an order in-original dated 31.01.2008 rejecting the entire refund claim. The petitioner Company went in appeal before the Commissioner (Appeals....
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....06.2008. However, for the period after 03.06.2008, the Commissioner (Appeals) held that the refund claim was sanctioned, but the amount was transferred to the Fund because of unjust enrichment and such order of Commissioner (Appeals) to refund the amount but crediting it to the Fund was an order of refund under section 11B(2) of the Central Excise Act and hence, no interest was payable for the period after 02.06.2008 because refund was paid to the petitioner Company within three months of the order of the Appellate Tribunal dated 06.11.2009. Pursuant to the above order of the Commissioner (Appeals), the Assistant Commissioner of Central Excise passed the order in-original dated 12.11.2010 and, sanctioned and paid interest of Rs. 5,40,094/- being the interest on refund of Rs. 28,94,776/- for the period from 24.04.2005 to 02.06.2008. Since the Commissioner (Appeals) had not granted interest for the period from 03.06.2008 till the date of actual payment, the petitioner Company went in appeal before the Tribunal claiming interest of Rs. 3,07,423/- and also further interest on interest because the petitioner Company was unnecessarily dragged to litigate for the claim of refund as well a....
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....o be read in; nothing to be implied and there is no room for any intendment. The court, accordingly, held that the liability of the revenue to pay interest under section 11BB of the Act commences from the date of expiry of three months from the date of receipt of application for refund under section 11B(1) of the Act and not on the expiry of the said period from the date on which order of refund is made. Reliance was placed upon the decision of the Rajasthan High Court in the case of J. K. Cement Works v. Assistant Commissioner of Central Excise & Customs, 2004 (170) ELT 4 (Raj.) wherein, the court held that a close reading of section 11BB, which now governs the question relating to payment of interest on belated payment of interest, makes it clear that relevant date for the purpose of determination of the liability to pay interest is not the determination under sub-section (2) of section 11B to refund the amount to the applicant and not to be transferred to the Consumer Welfare Fund but the relevant date is to be determined with reference to date of application laying claim to refund. The non-payment of refund to the applicant claimant within three months from the date of such app....
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....se, awarded simple interest at the rate of 9% per annum. It was submitted that therefore, though this court may not grant interest on interest, at least some amount is required to be directed to be paid to the petitioner by way of compensatory costs. 6. Opposing the petition, Mr. Gaurang Bhatt, learned Senior Standing Counsel for the respondents submitted that in the facts of the present case, the refund claim was filed on 24.01.2005 and therefore, the petitioner would be entitled to interest for a period after three months from such date. Accordingly, the Commissioner (Appeals) rightly granted interest on the amount of Rs. 28,94,776/- for the period starting from 24.04.2005 to 02.06.2008, which is in accordance with the statutory provisions contained in section 11BB of the Central Excise Act. It was submitted that the revenue authorities have, within a period of three months from 11.12.2009 i.e. the date of the order passed by the Tribunal, granted refund for the period from 24.04.2005 to 02.06.2008 for the reason that the refund came to be sanctioned on 13.06.2011 and was transferred to the Consumer Welfare Funds. It was submitted that when the amount was already transferred t....
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....on 24.01.2005 and the amount was refunded on 12.11.2010. The interest on refund of Rs. 28,94,776/-, however, in terms of the order of the Commissioner (Appeals) and the Tribunal, was paid for the period from 24.04.2005 to 02.06.2008 and the interest from 03.06.2008 till the date of actual payment i.e. 10.03.2010 was not paid on the ground that such amount had been transferred to the Consumer Welfare Fund pursuant to the order passed by the Commissioner (appeals). 9. Under section 11BB of the Central Excise Act, there is an obligation upon the respondents to pay the interest at the prescribed rate immediately after the expiry of three months from the date of receipt of such application till the date of refund of such duty, which in the present case is from 24.04.2005 to 10.03.2010. The case of the respondent is that with effect from 03.06.2008, the amount had been transferred to the Consumer Welfare Fund and therefore, the liability of the revenue to pay any interest was discharged. In the opinion of this court, such contention cannot be countenanced for the reason that the section 11BB of the Central Excise Act provides for payment of interest after a period of three months from....