TaxTMI 
TaxTMI 
2024 (3) TMI 593
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....hem on 18 March, 2015. It was only through show cause notice dated 25th May, 2015 that they were informed about certain deficiencies which were made good vide their written submissions and consequent to the personal hearing held on 10th June, 2015 and documents were filed by them on 23rd June, 2015 and eventually the refund was sanctioned on 31st August, 2015. The amount was disbursed on by 4th September, 2015. The party has demanded interest on refund from the date on 16 March, 2015 upto 4th September, 2015 on the ground that refund was not sanctioned within three months. 2. Learned Authorized representative for the party to justify its stand relies upon the order of RANBAXY LABORATORIES LTD VS. UNION OF INDIA as reported in 2011 (273) EL....
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....boratories Limited (supra). In the said case, the question arose whether the liability of the Revenue to pay interest under Section 11-BB of the Act commences from the date of expiry of three months from the date of receipt of application for refund or on the expiry of the said period from the date on which the order of refund is made. The two-Judge Bench after analyzing the provision has held as follows:- "12. It is manifest from the afore-extracted provisions that Section 11BB of the Act comes into play only after an order for refund has been made under Section 11B of the Act. Section 11BB of the Act lays down that in case any duty paid is found refundable and if the duty is not refunded within a period of three months from the date of....
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....es payable. [Emphasis supplied] 18. While dealing with the said fact of delay, the Court also referred to circular dated 01.10.2002 issued by the Central Board of Excise and Customs, New Delhi whereby a direction was issued to fix responsibility for not disposing of the refund/rebate claims within three months from the date of receipt of the application. Appreciating the scope of the said circular, the Court opined as follows:- "12. Thus, ever since Section 11BB was inserted in the Act with effect from 26th May 1995, the department has maintained a consistent stand about its interpretation. Explaining the intent, import and the manner in which it is to be implemented, the Circulars clearly state that the relevant date in this regar....
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....nation can be carried on beyond three months. It is required to be concluded within three months. The decision in Ranbaxy Laboratories Limited (supra) commends us and we respectfully concur with the same." 5. The Hon'ble Supreme Court, thus came to the conclusion that it was obligatory on the part of department also to initiate deficiency memo as well as correspondence with the party relating to any deficiency in the refund claim within two days with the receipt of the application. 6. The learned Counsel of the appellant is categorical, there is no such communication within stipulated period of two days that was received by them and therefore interest has been correctly demanded by them. 7. Considered. This Court finds the matter has be....