TaxTMI 
TaxTMI 
2020 (12) TMI 502
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....50172/19 Vikas Cable Company 10,00,000 June, 2006 12.02.07 02.12.10 35,97,232/- 02.02.18 26.06.18 28.11.18 2. From the facts which are similar in all these appeals, the appellants during the course of investigation had made deposit towards the expected demand prior to issue of show cause notice. Thereafter, separate show cause notices were issued all dated 12.02.2007 proposing to disallow the cenvat credit on the input(s) received. The show cause notices were adjudicated and confirmed vide separate orders-in-original dated 02.12.2010 confirming the proposed demands alongwith penalty. The matters were finally settled vide Final Order No. A/50465-81/2018-EX (DB) dated 02.02.2018 of this Tribunal in favour of the appellants -assessee setting aside the orders confirming demand and penalty. On being successful, the appellant-assessees applied for refund alongwith interest. The adjudicating authority allowed the refund vide separate orders-in-original dated 26.06.2018 but was pleased to reject the claim of interest on refund by making a self contradictory observation that the appellant had not made the payment themselves towards pre-deposit, therefore, this amount cannot be....
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....terest on such amount at the rate notified from the date of payment of amount till the date of refund of such amount. 6. Learned Counsel for the appellant submits that the scheme of Central Excise Act and its Rules has always been that wherever any demand of duty has not been paid by any assessee at the appropriate rate and date, the same attracts charging of interest on such amount from such date. Such principle needs to be followed even in such cases where any amount has been retained and utilised by the Revenue till the date of reimbursement of such amount to the assessee. In such cases, the assessee needs to be compensated by way of interest, towards the financial loss suffered by the assessee, due to action of the Revenue. To support his contention, he relied on the decision of the Hon'ble Apex Court in the case of Sandvik Asia Limited -2006 (196) ELT 257 (SC). 7. He further submits that although the decision of the Hon'ble Apex Court is in the context of Income Tax Act, but the provisions for entertaining the interest are identical to the provisions of Central Excise, and in terms of Article 141 of the Constitution of India, the judgement given by the Hon'ble Supreme Court ....
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....ion of the Ld.AR is that in terms of Section 35FF of the Central Excise Act, 1944, the interest on delayed refund is to be paid after 3 months from the date of communication of the order. When specific statute has been made, therefore, the decision in the case of Sandvik Asia Limited (supra) is not applicable to the facts of this case on the ground that the said decision has been delivered by the Hon'ble Apex Court in the context of Income Tax Act whereas we are dealing with Central Excise Act provisions. I find that whether the provisions of Income Tax Act and the provisions of Central Excise Act are pari materia or not. The same has been examined by this Tribunal in the case of Donar Foods reported in 2017 (346) ELT 612(Tri.-Chan.) wherein this Tribunal observed as under:- "27. We have seen both decisions referred before us. The decision in the case of M/s. Cynamid India Ltd. (SC) is with regard to the Income Tax Act and as per Section 2(29BA) of the Income-tax Act, 1961 the term "manufacture" with its grammatical variation means a change in non-living physical object or article - (a) resulting in transformation of object or article or things into a new and distinct object or....
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....anufacture has been failed as the goods are not manufactured goods as per Section 2(f) of Central Excise Act, accordingly, the question of excisability does not arise. Therefore, the Issue No. 1 is answered in favour of the appellants." The said decision of this Tribunal has been affirmed by the Hon'ble Apex Court reported 2017 (354) ELT A-57(SC) wherein "It was also held that the definition of "manufacture' under Section 2(f) of the Central Excise Act, 1944 is pari materia to the definition provided under Section 2(29BA) of the Income-tax Act, 1961." Therefore, I find no force in the arguments advanced by the Ld.AR that the decision of Income Tax Act is not applicable to the Central Excise Act whereas the provisions of both Acts are pari materia. Therefore, the argument advanced by the Ld.AR is turned down and not acceptable. 12. He further made reliance on the decision of Hon'ble Apex Court in the case of ITC Ltd.(supra). 13. I have gone through the case laws relied upon by the Ld.AR. In the case of ITC Ltd.(supra), the decision of Hon'ble Apex Court has been delivered on 02.12.2004 whereas the decision in the case of Sandvik Asia Limited (supra) delivered on 27.1.2006. T....
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....te of refund of such amount." 17. On-going through the provisions of both Income Tax Act, 1961 and Central Excise Act, 1944, the interest on delayed refund is payable after expiry of 3 months from the date of granting refund or from the date of communication of order of the appellate authority, which are pari-materia. Therefore, the decision of Hon'ble Apex Court in the case of Sandvik Asia Ltd. (supra) is law of land, in terms of Article 141 of the Constitution of India which is to be followed by me, wherein the Hon'ble Apex has observed as under:- "45. The facts and the law referred to in paragraph (supra) would clearly go to show that the appellant was undisputably entitled to interest under Sections 214 and 244 of the Act as held by the various High Courts and also of this Court. In the instant case, the appellant's money had been unjustifiably withheld by the Department for 17 years without any rhyme or reason. The interest was paid only at the instance and the intervention of this Court in Civil Appeal No. 1887 of 1992 dated 30.04.1997. Interest on delayed payment of refund was not paid to the appellant on 27.03.1981 and 30.04.1986 due to the erroneous view that had been ....
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....iving back an equivalent in either money which is but the measure of value, or in actual value otherwise conferred; a recompense in value; a recompense given for a thing received recompense for the whole injury suffered; remuneration or satisfaction for injury or damage of every description; remuneration for loss of time, necessary expenditures, and for permanent disability if such be the result; remuneration for the injury directly and proximately caused by a breach of contract or duty; remuneration or wages given to an employee or officer." 47. There cannot be any doubt that the award of interest on the refunded amount is as per the statute provisions of law as it then stood and on the peculiar facts and circumstances of each case. When a specific provision has been made under the statute, such provision has to govern the field. Therefore, the Court has to take all relevant factors into consideration while awarding the rate of interest on the compensation. 48. This is the fit and proper case in which action should be initiated against all the officers concerned who were all in charge of this case at the appropriate and relevant point of time and because of whose inaction the ....
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....gh Court taking contrary view, will be no longer good law. The said judgment is rendered, in my considered opinion under similar circumstances. So also in Kuil Fire Works Industries v. Collector of Central of Excise [1997 (95) E.L.T. 3 (S.C.), the pre-deposit made by the assessee was directed to be returned to him with 12% interest. I have also come across the judgment of the Calcutta High Court in Madura Coats Pvt. Ltd. v. Commissioner of C. Ex., Kolkata-IV [2012 (285) E.L.T. 188 (Cal.), wherein the peremptory directions of the Apex Court in the judgment of ITC Ltd. (supra) was considered and ordered 12% interest, and further held that when the High Court directed the respondents to pay interest to the appellant in terms of the circular dated 8-12-2004 on the pre-deposit of the delayed refund within two months, it has to be construed that, the Court meant the rate of interest which was awarded by the Supreme Court in the case of Commissioner of Central Excise v. ITC Ltd., which was the rate quantified by the Supreme Court in the absence of any statutory provisions in the Act in question. Even though various other judgments of various High Courts and the various Tribunals was broug....