AI OCR 
TaxTMI 
TaxTMI 
TaxTMI 
2026 (4) TMI 793
X X X X Extracts X X X X
X X X X Extracts X X X X
....est, but the request of the appellant for payment of interest for the period from 07.08.2017 to 07.02.2023 was not considered by the authorities. The appellant has stated that the interest amount claimed for the said period i.e., from 07.08.2017 to 07.02.2023 was in the nature of compensation, which should be paid by the revenue, irrespective of the fact that the interest amount of Rs. 64,62,575/- had already been paid by the department on account of delayed refund of the pre-deposited amount. 2. Learned advocate appearing for the appellant submitted that the pre-deposit made by the appellant under Section 35F of the Central Excise Act, 1944 (for short, 'The Act of 1944') was refunded by the department on 07.08.2017, pursuant to the orde....
X X X X Extracts X X X X
X X X X Extracts X X X X
....nue submitted that while sanctioning the refund of pre-deposit alongwith interest, the department had referred to the provisions of Section 35FF of the Act of 1944 and since under such statutory provisions, the interest is required to be paid from the date of payment of the amount till, the date of the refund of such amount, the additional interest claim made by the appellant, considering the same as compensatory in nature, cannot be sustained. He further submitted that since the Central Excise statue do not provide for payment of any interest on the compassionate ground, the department's stand is proper and justified in denying such additional amount of compensation as claimed by the appellant. 4. Heard both sides and perused the case r....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ing authority only sanctioned the refund of Rs. 60 Lakhs and not provided the interest on Rs. 60 Lakhs in 2017. 07.08.2017 8 Commissioner (A) (remand for interest) Remand. 26.11.2018 9 Order-in-original rejected 20.12.2019 10 Commissioner (A) Allowed the appeal and only granted interest @6% from 07.02.2017 till the date of refund that is 07.08.2017. 26.02.2021 11 CESTAT (allowed 12% interest) CESTAT considered both aspect Section 35FF and Sandvik Asia (SC Judgment) and directed the authority to make the payment of interest @12% from the date of Deposit on 10.05.2022 10.05.2022 12 Order-in-original The authority granted interest of RS. 64,62,575/- only from the date of pre-deposit u....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ides that an assessee-appellant should be entitled for interest at the prescribed rate from the date of payment of the amount, till the date of refund of such amount. The statutory provision contained in Section 35FF of the Act of 1944 is quoted below: "35FF. Interest on delayed refund of amount deposited under section 35F Where an amount deposited by the appellant under section 35F is required to be refunded consequent upon the order of the appellate authority, there shall be paid to the appellant interest at such rate, not below five per cent. and not exceeding thirty-sixper cent. per annum as is for the time being fixed by the Central Government, by notification in the Official Gazette, on such amount from the date of p....
X X X X Extracts X X X X
X X X X Extracts X X X X
....eriod from 07.08.2017 to 07.02.2023. On careful reading of the provisions of 35FF ibid, it would transpire that the said statutory provision has been duly complied with by the department inasmuch as they had refunded the pre-deposit amount and also paid the interest on such delayed refund up to the period of actual grant of the refund benefit. However, the appellant has claimed that it should be entitled for interest up to the period of 07.02.2023, which is in the nature of 'compensation by way of payment of interest'. To substantiate such stand, the above quoted judgments were referred to by the appellant. 10. In case of Sandvik Asia Ltd.(supra), the delayed payment of amount of interest was considered under Section 244A of the Income T....