TaxTMI 
TaxTMI 
2025 (9) TMI 1102
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....osit of penalty amount when such pre-deposit was not returned/ refunded to the appellant within three months after the appeal was allowed in favour of the appellant?" 4. Brief facts of the case are as under:- 4.1 The appellant company is, inter alia, engaged in the business of manufacture of products like Soda Ash. The appellant imported certain machineries which was subjected to some dispute on valuation. The Commissioner of Customs, Kandla adjudicated the case in 1991 confirming differential duty of Rs.1,46,68,637.76 and imposed penalty of Rs.50 lakh. 4.2 Being aggrieved, the appellant filed an Appeal and Stay Application before the CESTAT. While deciding the Stay Application, the CESTAT ordered the appellant to pre-deposit a sum of Rs. 10 lakh vide order dated 19.2.1992. The amount was deposited with Commissioner of Customs, Kandla. The CESTAT finally decided the Appeal vide final order dated 13.5.1994 and the penalty was set-aside. The appellant filed claim for return of the pre-deposit in January, 1997 after various litigation 4.3 The respondent refunded the amount of pre-deposit on 9.7.2002 without payment of interest. The appellant, therefore, approached adjudica....
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....7.2 The subsequent Larger Bench Decision in the case of Advance Mechanical Works cited supra has taken a different view. The relevant portion of the decision of the Larger Bench is reproduced below: 4. The referral order is concerned with the same issue, ie., whether interest is payable on the redemption fine while refunding it. The issue is fairly covered by the decision of the Apex Court in Orient Enterprises supra. The circumstances under which interest is payable on the delayed refunds are enumerated in the Central Excise Act as well as Customs Act presently. The decision in Sheela Foam Pvt. Ltd. pertains to deposit made towards duty during the course of investigation and is not in regard to fine paid in pursuance of an adjudication order. The Apex Court clearly held that even under Article 226 of the Constitution, a claim for interest on redemption charges paid in pursuance of an adjudication order which was set aside later, can't be maintained. The present appellant's claim for interest on the redemption fine therefore cannot be upheld. 5. We observe that there is no conflict between the decision in Sheela Foam and Orient Enterprises. The latter was ....
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.... various following decisions: i. Union of India v. TATA SSL Ltd, reported in 2007 (218) E.L.T 493 (S.C); ii. Bharat Heavy Electricals Ltd. v. Commissioner, reported in 2008 (224) ELT A133 (S.C); iii) Bharat Heavy Electricals Ltd. v. Commissioner of Central Excise, Meerut, reported in 2002 (139) E.L.T 591 (Tri.-Del); iv) Comm. Of Central Excise & Customs, Surat-II versus Sachin Textiles (P) Ltd, rendered in Central Excise & Customs Gold Control Application No.1 of 2011 of this Court; v) Abdulla Gani v. Union of India, reported in 2013(298) E.L.T 221 (Bom.); vi) Commissioner of Customs, Cochin v. Shree Simandar Enterprises, reported in 2012 (283) E.L.T 369 (Ker.); and vii) Suvidhe v. Union of India, reported in 1996 (82) E.L.T 177 (Bom.) 6. On the other hand, learned advocate Mr. Deepak Khanchandani for the respondent submitted that the appellant has made the pre-deposit pursuant to the stay order granted by the CESTAT and, therefore, it would amount to payment towards the penalty and, therefore, as per the provisions of Section 27A of the Act, the CESTAT has rightly not awarded to the appellant interest on late paymen....
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.... section 11BB would also not be attracted. The order of the Tribunal, therefore, prima facie does not appear to be in consonance with the statutory provisions. However, though the respondent may not be entitled to interest on delayed refund under section 11BB of the Act, it is not as if it is not entitled to any interest at all on late refund of the amount of predeposit. In the case of Commissioner of Central Excise, Hyderabad Vs. I.T.C. Limited, 2005 (179) E.L.T. 15 (SC), the controversy in issue before the Supreme Court was as to whether the pre-deposit made as a pre-condition for the hearing of the appeal under the Central Excise Act, 1944 was, on the assessee being ultimately successful, refundable to the assessee with interest. On behalf of the revenue it was stated before the Court that the Central Board of Excise and Customs proposes to issue a circular in connection with the payment of interest on all such pre-deposits, a draft copy whereof was placed before the Court. Having regard to the contents of the draft circular, the Court directed compliance with the final order impugned before it and payment of interest in terms of the draft circular. In the said case, the Court d....
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....om the date of receipt of application under sub-section (1) of that section, there shall be paid to that applicant interest at such rate, not below five percent and not exceeding thirty percent per annum 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 27 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 Customs or Deputy Commissioner of Customs under sub-section (2) of section 27, ....