TaxTMI 
TaxTMI 
2020 (6) TMI 60
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....he case giving rise to refund of the duty claimed by the respondent. The respondent are engaged in the manufacture of Chewing tobacco without lime which has been subjected to compounded levy being notified under section 3A of the Central Excise Act, 1944. The respondent had filed necessary declaration under relevant rules declaring the number of machines installed in the factory for determination of annual capacity of production of the installed machines and in turn for payment of duty. The adjudicating authority, to ascertain the correctness of the commodity declared as manufactured, drawn samples and sent for testing at CRCL, New Delhi. From the test report it revealed that the appellant are engaged in the manufacture of Jarda Scented Tobacco classifiable under CSH 24039910 and not Chewing Tobacco without lime tube falling under CSH 24039930 as declared. Consequently, after handing over the test report, the adjudicating authority determined the annual production capacity of installed machines considering the commodity as Jarda Scented Tobacco for the period from July 2015 to January 2016. The respondent assailed the said orders by filing Appeals before the Commissioner (Appeals).....
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....noticed that an amount of Rs.29,91,483/- was not supported with payment particulars. Accordingly, a letter was written to the respondent to place evidence in support of the said amount. As the respondent did not have any evidence relating to the said claim of Rs.29,91,483/-, they withdrew the same from the total claim. However, later they filed appeal before the Ld. Commissioner (Appeals) against rejection of the said amount and also claimed interest on the amount deposited. The learned Commissioner (Appeals) allowed their appeal. Hence, the Revenue is in appeal. 6. The ld. A.R for the Revenue has submitted that the learned Commissioner (Appeals) is erred in allowing the refund amount of Rs.29,91,483/-, even though the respondent had voluntarily withdrew the said amount since they could not produce evidence in support of payment of the said amount. Further, he has submitted that the finding of the Commissioner (Appeals) that the said amount relates to payment of duty for 3 days during which the factory was closed, is extraneous and devoid of merit. It is his contention that refund claim cannot be filed under section 11B of Central Excise Act, 1944 for the period of closure of the ....
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....e amount has been collected by the Department at the end of the month, no further evidence is required to be submitted about its payment, hence the ld. Commissioner (Appeals) also allowed the refund of the same. He has fairly submitted that through their letter dt.05.4.2020 they have withdrew the claim amount of Rs. 29,91,483/-. 9. Heard both sides and perused the records. 10. The issues involved in the present appeal for determination are - (i) Whether the refund amount of Rs. 29,91,483/- is correctly allowed to the Respondent; (ii) Interest on the total refund amount of Rs. 15,61,27,257/- is payable to the respondents from the date of its deposit. 11. We find that the appellant had declared the goods manufactured by them as 'Chewing Tobacco without lime tube' and accordingly discharged duty @ Rs. 38.64 Lakhs under Section 3A of Central Excise Act,1944 read with relevant Notification on the number of machines installed in the factory for the period from July, 2015 to January, 2016. Later, on chemical analysis at the instance of the Dept. at CRCL, New Delhi, the commodity was found to be not Chewing Tobacco but Jarda Scented Tobacco classifiable under sub-heading 24039930 of....
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....ide. 14. As far as the issue of interest on the deposit is concerned, it is not clear whether the same was also raised before the adjudicating authority. We find that the show-cause notice dt. 01.7.2016 issued alleging mis-classification of the commodity declared by the respondent and also there is proposal for appropriation of the differential duty paid with interest consequent to the capacity determination order passed. The said notice is yet to be adjudicated/decided. Till the time the show cause notice is adjudicated, the amount paid by the respondent cannot be said to have attained finality and refundable to them. The Tribunal directed the return of the said amount deposited by the respondent during investigation in all fairness attributable to inordinate delay of adjudication of the Show Cause Notice issued by the department. Needless to emphasize it is an interim measure caused to mitigate the hardship to the respondent for the delay in adjudication by the department. But, that does not mean that respondent can retain the said amount even if the issue of classification is decided against them. Therefore, the ld. Commissioner (Appeals) order directing payment of interest fro....
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....ubt or ambiguity in these propositions, reference must be had to the discussion and proposition in the body of judgement. (i) to (ix) ..... (x) By virtue of sub-setion (3) to Section 11B of Central Excise Act, 1944, as amended by the aforesaid Amendment Act, and by virtue of the provisions contained in sub-section 3 to Section 27 of the Customs Act, 1962, as amended by the aforesaid Amendment Act,, all claims of refund (excepting those which arise as result of declaration of unconstitutionality of the provision whereunder the levy was created) have to be preferred and adjudicated only under the provisions of respective enactment. No suit for refund of duty is mantainable in that behalf. So far as jurisdiction of High Court under Article 226 of the Constitution, or this Court under Article 32 - is concerned it remains unaffected by the provisions of the Act. Even so, the court would while exercising the jurisdiction under the said articles, have regard to legislative intent manifested by the provisions of the Act. The writ petitions would naturally considered and disposed of in the light of and in accordance with the provisions of Section 11B. This is for the reason that the power....
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....ing in the appeal, and, (ii) the refunds so claimed are covered under the provisions of Section 11B of the Act and are governed by the parameters applicable to the claim of refund of duty as the amount is deposited under Section 35F of the Central Excise Act, 1944. The Hon'ble Supreme Court vide its order dated 26-11-2001 dismissed the appeal. Even though the Apex Court did not spell out the reasons for dismissal, it can well be construed in the light of its earlier judgment in the case of Suvidhe Ltd. and Mahavir Aluminium that the law relating to refund of pre-deposit has become final. 3. In order to attain uniformity and to regulate such refunds it is clarified that refund applications under Section 11B(1) of the Central Excise Act, 1944 or under Section 27(1) of the Customs Act, 1962 need not be insisted upon. A simple letter from the person who has made such deposit, requesting the return of the amount, along with an attested Xerox copy of the order-inappeal or CEGAT order consequent to which the deposit made becomes returnable and an attested Xerox copy of the Challan in Form TR6 evidencing the payment of the amount of such deposit, addressed to the concerned Assistan....
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....e shall be paid forthwith." 4.0 After taking the note of the draft circular reiterating the circular of 2002 placed before it, Supreme Court in Commissioner of Central Excise v. ITC Limited, [(2005) 179 ELT 15 (SC)], interest was payable for the period commencing from three months after the final disposal of the matter till the date of refund. The Circular of 2004 is reproduced below: "Circular No.802/35/2004-CX 8th December, 2004 F.No.387/5/2001-JC Government of India Ministry of Finance (Department of Revenue) Central Board of Excise & Customs Subject: Return of deposits made in terms of Section 35F of the Central Excise 1944 and Section 129E of the Customs Act, 1962. Reference earlier instructions on the above subject and looking to the instances arising out of non-implementation of the judicial orders, the Board has reason to review and reiterate the earlier Circulars on the subject of non-implementation of orders of CESTAT or any Final Authority in relation to returning pre-deposits made as per directions of CESTAT or any other Final Authority in terms of Section 35F of the Central Excise Act, 1944 & Section 129E of the Customs Act, 1962. The Board has taken a strict....
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....s, the interest should have been granted within three months of date of the order. 6.0 Hon'ble jurisdictional High Court i.e. High Court of Punjab and Haryana has in case of Shreewood Products Pvt Ltd [2016 (44) STR 592 (P & H)] held as follows: "7. Keeping in view the aforesaid facts and circumstances, in our opinion, the appellant herein is entitled to payment of interest @ 12% per annum for the period after three months till the refund was granted after passing of the order by the Tribunal on 2.5.2008. The questions, referred to above, are answered accordingly." 7.0 Similarly in case of Nino Chaka [2019 (9) TMI 1166], Hon'ble Delhi High Court held as follows: "10. Moreover, it appears from the facts of the case that CESTAT order is dated 20.11.2003 and it has been ordered by CESTAT, New Delhi that if the amount is not returned to the petitioner by the respondents within a period of three months the interest shall be payable. The said period comes to an end on 21.02.2003. As the amount at Rs. 28,76,578/- was not paid on 21.02.2003 by the respondents, the payment of interest starts till the actual date of payment. The amount was refunded by the respondents on 14.05.2004. Hence....