TaxTMI 
TaxTMI 
2023 (2) TMI 437
X X X X Extracts X X X X
X X X X Extracts X X X X
....ng investigation on 03.02.1995 the said amount was deposited on behalf of the Appellant by their customer M/s. Omsagar Engg Pvt. Ltd. under protest. After the decision of this Tribunal, the appellant filed refund claim on 26.10.2018 and later on submitted the 'NOC' by the said Omsagar Engg Pvt. Ltd. on 12.01.2019. The Authority concerned vide Order-in-Original dated 08.02.2019 sanctioned the refund amount of Rs. 23,15,437/- in terms of Section 11B of Central Excise Act, 1944 and rejected the refund of Rs.1 lakh on account of penalties imposed upon M/s. Omsagar Engg. Pvt. Ltd. as neither M/s Omsagar Engg. Pvt. Ltd. challenged the said penalty nor deposited the aforesaid amount and therefore the said amount was deducted from the total amount of refund. Since no interest on refund was granted by the adjudicating authority therefore the appellant filed appeal before the first appellate authority claiming interest on refund from the date of deposit up to 25.02.2019 i.e. the date when they received the refund. Learned Commissioner (Appeals) vide impugned order has observed that the appellant had filed incomplete application for refund and the deficiency in the said application, as ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....are reproduced hereunder: "SECTION [11B. Claim for refund of [duty and interest, if any, paid on such duty]. - (1) Any person claiming refund of any [duty of excise and interest, if any, paid on such duty] may make an application for refund of such [duty and interest, if any, paid on such duty] to the [Assistant Commissioner of Central Excise or Deputy Commissioner of Central Excise] before the expiry of [one year] [from the relevant date] [[in such form and manner] as may be prescribed and the application shall be accompanied by such documentary or other evidence (including the documents referred to in section 12A) as the applicant may furnish to establish that the amount of [duty of excise and interest, if any, paid on such duty] in relation to which such refund is claimed was collected from, or paid by, him and the incidence of such [duty and interest, if any, paid on such duty] had not been passed on by him to any other person : Provided that where an application for refund has been made before the commencement of the Central Excises and Customs Laws (Amendment) Act, 1991, such application shall be deemed to have been made under this sub-section as am....
X X X X Extracts X X X X
X X X X Extracts X X X X
....nnum as is for the time being fixed [by the Central Government, by Notification in the Official Gazette], on such duty from the date immediately after the expiry of three months from the date of receipt of such application till the date of refund of such duty : Provided that where any duty ordered to be refunded under sub-section (2) of section 11B in respect of an application under sub-section (1) of that section made before the date on which the Finance Bill, 1995 receives the assent of the President, is not refunded within three months from such date, there shall be paid to the applicant interest under this section from the date immediately after three months from such date, till the date of refund of such duty. Explanation. - Where any order of refund is made by the Commissioner (Appeals), Appellate Tribunal [, National Tax Tribunal] or any court against an order of the [Assistant Commissioner of Central Excise or Deputy Commissioner of Central Excise], under subsection (2) of section 11B, the order passed by the Commissioner (Appeals), Appellate Tribunal [National Tax Tribunal] or, as the case may be, by the court shall be deemed to be an order passed under t....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... Section 11B is payable only from the date of expiry of three months from the date of receipt of application for refund. Therefore, now there is no ambiguity or doubt that from which the date interest is payable in case of refund of duty. As Regard the decision relied upon by the Ld. Counsel in the case of Futura Ceramics Pvt. Ltd. (supra). I find that this decision has not considered the various judgment relied upon by the Ld. AR particularly the case of Ranbaxy Laboratories Ltd., Kamakshi Tradexim (India) Pvt. Ltd., therefore, the decision of this Tribunal dated 21-11-2017 is distinguished. As per my above discussion, the impugned order is upheld. The appeal is dismissed." 6. From a bare reading of the section 11BB ibid it is clear that the legislature has casted a duty upon the adjudicating authority to decide the claim for refund immediately within three months, failing which the liability for interest starts running after expiry of three months from the date of the application. In the instant matter, if there is any deficiency in the application, the department could have rejected the said application as they are under obligation to decide the application one way or other d....
X X X X Extracts X X X X
X X X X Extracts X X X X
....nths from the date of the receipt of the application for refund if the amount is not refunded within three months from the date of receipt of the application. The learned Counsel appearing for respondent also relied in support of his submission on the judgments of various High Courts. However, in our opinion, the position of law is absolutely clear that the interest is payable under Section 11BB of the Act on expiry of period of three months from the date of receipt of the application and that Explanation appearing below Section 11BB of the Act does not have any effect or connection with the date from which interest under Section 11BB of the Act becomes payable. The only purpose served by the explanation, as observed above, is to introduce a deeming fiction which is relevant for the purpose of sub-section (2) of Section 11B of the Act." 7. Learned Counsel also placed on record the order dated 11.10.2022 of Adjudicating Authority i.e. Deputy Commissioner in respect of similar show-cause notice issued by Visakhapatnam Commissionerate in which the adjudicating authority granted interest to them on pre-deposits paid by them. I have gone through the same, also in order to understand ....