TaxTMI 
TaxTMI 
2025 (6) TMI 439
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.... the appeals is common, therefore, both the appeals are taken up together for discussion and decision. A brief chronology of events in respect of both the appeals is as under in tabular form : Chronology Events of E/60156/2022 E/60157/2022 Amount deposited by the appellant Rs. 1,00,000/- vide TR-6 Challan dated 20.02.2002; Rs.10,00,000/- vide TR-6 Challan dated 07.12.2006 as a pre-deposit in compliance to order of Hon'ble High Court of Delhi Rs. 1,00,000/- vide TR-6 Challan dated 20.02.2002; Rs.10,00,000/- vide TR-6 Challan dated 07.12.2006 as a pre-deposit in compliance to order of Hon'ble High Court of Delhi SCN issued proposing demand SCN dated 10.04.2002 proposing demand of Rs.20,75,207/- SCN dated proposing 10.04.2002 demand of Rs.18,22,684/- OIO confirming demand the OIO dated 30.06.2005 OIO dated 30.06.2005 OIA confirming demand the OIA dated 21.04.2006 OIA dated 21.04.2006 CESTAT Final Order dropped the demand Final Order 02.02.2017 dated Final Order 02.02.2017 dated Date of filing the refund application 24.11.2017 07.11.2017 Refund sanctioned (without interest) Order dated 11.04.2018 Order dated 05.02.2018 Date letter interest of request seeking L....
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....prived of the money which remained with the department for such a long period and was then refunded, for which, the appellants need to be compensated for such delayed retention. He further submits that the scheme of Central Excise Act/Rules provides that whenever any demand of duty has not been paid by any assessee at the appropriate rate and time, the same attracts charging of interest on such amount for such delay; therefore, the principle of equity needs to be followed even in such cases where any amount has been retained/withheld by the Revenue till the date of reimbursement of such amount to the assessee. In support of his submission, he relies on the following cases: * Sandvik Asia Limited vs. Commr of Income Tax-I, Pune - 2006 (1) TMI 55 Supreme Court * Parle Agro Pvt Ltd vs. Commr of CGST, Noida (and vice versa) - 2021 (5) TMI 870 CESTAT Allahabad * Fujikawa Power And Others vs. CCE - 2019 (11) TMI 1197 CESTAT Chandigarh * Riba Textiles Limited vs. CCE - 2020 (3) TMI 602 CESTAT Chandigarh * CCE vs. Riba Textiles Limited - 2022 (3) TMI 693 - Punjab & Haryana HC * Indore Treasure Market City Pvt Ltd vs. CCE - Final Order No. 50125/2024 dated 11.01.2024 in Appeal N....
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....submits that the adjudicating authority has held that the interest in payable on pre-deposit of Rs.11,00,000/- under Section 35FF of the Act, as it stood prior to 06.08.2014, since the refund was not disbursed to the appellant within 3 months of receipt of the CESTAT's final order dated 02.02.2017; and the Commissioner (Appeals), vide the impugned orders dated 30.09.2021, while deciding the matters on merit, has also held that the appellants are entitled to interest on Rs.11,00,000/- under Section 35FF of the Act, as it stood prior to 06.08.2014, as the said pre-deposit has not been disbursed within 3 months of receipt of the final order dated 02.02.2017. 5.3 He further takes me through the findings of three members' bench of Hon'ble Apex Court in the case of CCE, Hyderabad vs. ITC Ltd (supra), which was again followed by the Hon'ble Apex Court in the case of UOI vs. Tata SSL Ltd (supra). 5.4 In support of his submissions, he also relies on the following decisions, wherein the various High Courts, after relying on the judgment of Hon'ble Apex Court in the case of CCE, Hyderabad vs. ITC Ltd (supra), have ordered for payment of interest from the date after 3 months from the date of....
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.... made. The Division Bench of the Tribunal, after considering the judgment of Hon'ble High Court of Delhi in the case of Goldy Engineering Works (supra), has held that the assessee-appellant is not entitled to interest from the date of deposit but is entitled to interest as per the provisions prescribed under Section 11BB or Section 35FF. In this regard, I may refer the relevant finding, which is reproduced herein below: "6. We find that though the issue of grant of interest on the pre-deposits has been a subject matter of litigation for long, in a recent judgment in the case of Goldy Engineering Works - (2023) 10 Centax 189 (Del.), Hon'ble Delhi High Court has put to rest the different interpretations on this issue holding that interest is governed only by two provisions i.e. Section 11BB and Section 35FF of the Central Excise Act; in the case of refund of deposit made during the investigation or during the proceedings shall be governed by Section 11B and accordingly, the interest shall be governed by Section 11BB. Hon'ble Apex Court has affirmed the decision of the Hon'ble Delhi High Court and thus, the decision has become the law of the land. Hon'ble Delhi High Court observed a....
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....be decided in favour of the assessee and not being made dependent upon any application being made in respect thereof. 27. The aforesaid position stands further fortified when one reads Section 35FF of the 1944 Act. As would be evident from a reading of that provision, Section 35FF as distinct from Section 11B does not require the making of a formal application by the assessee. In fact and contrary to Section 11B, the said provision uses the expression "....there shall be paid to the appellant interest.....". Thus, the language of Section 35FF is an embodiment of the manifest obligation of the respondents to refund the pre-deposit consequent to an order passed by the Appellate Authority notwithstanding an application having not been made by the depositor. 28. The distinction between Sections 11B and 35FF is also evident when one bears in mind the language employed in the latter and which stipulates that interest would commence from the date when the amount deposited by the appellant under Section 35F is required to be refunded consequent to an order passed by the Appellate Authority. Section 35FF thus indicates that interest would commence from the date of the order of the Appel....
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....duty and a pre deposit were considered to be identical concepts. As was noted hereinbefore, a pre-deposit made as a condition of filing an appeal is in any case not considered to be "duty" even by the respondents. 32. The decision of this Court in Team HR Services, had frowned upon the distinction sought to be advocated by the respondents there between a deposit made under protest and a pre-deposit made in connection with an appeal. As would be further evident from a reading of Paras 14 and 15 the counsel appearing for the respondents had also failed to draw the attention of the Court to any statutory provision which governed the issue of refund. The aforesaid decision is thus clearly distinguishable especially when undisputedly, in the present matters the issue of refund is governed by the provisions of Sections 11B and 11BB. 33. Accordingly, and for all the aforesaid reasons, the instant writ petitions shall stand disposed of on the following terms. The respondents shall revisit the issue of payment of interest in light of the observations made hereinabove. Interest, if any, shall be liable to be computed and paid to the petitioners if it be found that the refund was affected....