TaxTMI 
TaxTMI 
2019 (6) TMI 507
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.... 1, 2003 Rasoi wanted to make use of the accumulated modvat credit but the same was not permitted by the Revenue. Accordingly, Rasoi paid an amount of Rs. 4.46 crores as duty in cash on the insistence of the Department. Rasoi filed a writ petition No. 983 of 2003 before the Hon'ble Calcutta High Court praying inter alia for being allowed to utilise the accumulated credit for payment of duty on Vanaspati manufactured and cleared from its factory and to take back the credit in its PLA, the duties forced to be paid from the said account instead of from RG23B Part-II Register. By a judgment and order dated June 9, 2004 the writ petition was allowed by the Hon'ble High Court. The Special Leave Petition preferred by the Revenue against this judgment, being SLP (C) No. CC 2314-2315/2005, was dismissed by the Hon'ble Supreme Court by an order dated March 7, 2005. Thereafter Rasoi was allowed to take credit in its PLA the duty of Rs. 4,46,62,485/- and to debit equivalent amount of duty in RG23B Part-II Register. 2. In the meantime, with effect from March 1, 2005, Vanaspati was again subjected to 'Nil' rate of duty. On this date, Rasoi had an unutilised balance of Rs. 4.10 crores in the P....
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....titled to utilize the credit lying in its RG -23B Part II Register and could not be forced to pay the said duty in cash. The interest has been claimed for the period from the respective dates of payments of the said duty in cash vide TR-6 challans upto the date of its refund dated March 16, 2005 when the said duty paid was allowed to be credited back in the PLA. 7.1 In the case of ONGC Limited Vs. CCE, 2007 (215) ELT 166 (SC), the assessee was forced to pay duty due to the Department rejecting its claim for exemption. The duties were realized during pendency of the appeals. The matter was ultimately decided in favour of the assessee. Before the Hon'ble Supreme Court it was claimed that on the amounts in question the Department is liable to pay interest. The said claim for interest was allowed by the Hon'ble Supreme Court by directing the Department to pay interest @6% per annum from the date of recovery of the amounts till the date of refund. 7.2 In Sandvik Asia Ltd. Vs CIT.2006 (196) ELT 257 (SC), the Hon'ble Supreme Court directed for payment of interest due to delay on the Department's part in granting the refund. After referring to various earlier decisions on the issue, ....
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....ssued for rejecting the claim for interest. As such, this contention of the Revenue has no merit and is untenable. 8. In so far as the Rasoi's claim for interest on duties of Rs. 4.10 crores for the period from three months after the date of filing the refund application till the date of refund, we find that the undisputed facts are that the refund application was filed on January 19, 2006 and the period of three months expired on April 18, 2006, but, however, the refund was granted on December 24, 2009. Hence, as per Section 11BB of the Central Excise Act, the Department is liable to pay statutory interest from April 19, 2006 to December 23, 2009. The contention of the Department is that the period of three months has to be computed not from the date of filing of the refund application but from the date of the Commissioner(Appeals)'s order, i.e. from 14/21.09.2006. 8.1 We find that this issue is covered by the judgment of the Supreme Court in Ranbaxy Laboratories Ltd. Vs. Union of India, 2011 (273) ELT 3. In the said judgment the Hon'ble Supreme Court held as under : "Manifestly, interest under Section 11BB of the Act becomes payable, if on an expiry of a period of ....
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....ore, the refund application filed under Section 11B was rejected by the Assistant Commissioner under Section 11B on the ground of alleged unjust enrichment. Thus these amounts were all along the duties of excise and treated as such by both the parties. Moreover, refund of deposits lying in the Account Current is specifically covered by Section 11B(2)(b) of the Central Excise Act, 1944. As held by the Hon'ble Madras High Court in CCE Vs. Rajalakshmi Textile Processors (P) Ltd., 2008 (221) ELT 38 (Mad) and by the Hon'ble Gujarat High Court in CCE Vs. Reliance Industries Ltd. 2010 (259) ELT 356 (Guj.), when the refund application was filed under Section 11B and was allowed under Section 11B(2), as in the instant case by the Commissioner (Appeals), the provisions of Section 11BB are automatically attracted for payment of interest. 8.4 Respectfully following the above stated decisions of the Hon'ble Supreme Court of India and the Hon'ble High Courts on the issues involved, we are of the view that the Commissioner (Appeals) has correctly allowed the claim for interest for the period April 19, 2006 to December 23,2009 on the duty amount of Rs. 4.10 crores. 9. The third part of the c....