TaxTMI 
TaxTMI 
2026 (7) TMI 636
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.... of the Finance Act, 1994, has been preferred by the Appellant assailing the Final Order No. 51603/2025 dated 17.10.2025 [hereinafter referred to as 'Impugned Order'] passed by the Customs, Excise and Service Tax Appellate Tribunal, Principal Bench, New Delhi [hereinafter referred to as 'the Tribunal'], whereby the Tribunal upheld the grant of interest at the rate of 6% per annum on the amount refunded to the Appellant pursuant to the setting aside of the service tax demand. 2. The controversy in the present Appeal lies within a narrow compass. The refund of the amount deposited by the Appellant during the course of investigation is not in dispute. The sole issue which arises for consideration is whether, in the facts and circumstances o....
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....est on the refunded amount was granted at the rate of 6% per annum. 8. Dissatisfied with the rate of interest so awarded, the Appellant preferred an appeal before the Commissioner (Appeals), contending that it was entitled to interest at the rate of 12% per annum on the refunded amount. The Commissioner (Appeals), by Order-in-Appeal dated 23.12.2024, rejected the Appellant's claim for interest at a higher rate. 9. The Appellant thereafter approached the Tribunal by filing Service Tax Appeal No. 50572/2025. By the Impugned Order dated 17.10.2025, the Tribunal dismissed the Appeal and affirmed the order passed by the Commissioner (Appeals), holding that the amount deposited during investigation was in the nature of a pre-deposit for....
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....e Court in Sandvik Asia Ltd. v. Commissioner of Income Tax-I, Pune (2006) 2 SCC 508 to contend that where the Revenue unjustifiably retains monies belonging to an assessee for an inordinate period, the Court is empowered to award compensatory interest at a rate higher than that provided under the statute. 11.4. Further reliance has also been placed upon CCE, Panchkula v. Riba Textiles Ltd. 2022 (62) GSTL 136 (P&H), Reliance Transport and Travel Pvt. v. Union of India (2022) SCC OnLine Bom 649, The Principal Commissioner of Central Goods and Service Tax v. M/s Green Valley Industries Pvt. Ltd. MC (Central Excise Ap.) No. 1/2023, Principal Commissioner of CGST v. Parle Agro Pvt. Ltd. MANU/UP/3382/2025, Reliance Transport and Travel Pvt. Lt....
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....ion is maintainable only where the case involves a substantial question of law. 15. The Appellant has already been granted refund of the amount deposited during investigation together with interest strictly in accordance with Section 35FF of the Act read with Notification No. 24/2014-C.E. (N.T.), dated 12.08.2014, whereby the Central Government has notified the rate of interest at 6% per annum. The only grievance raised by the Appellant is that the rate of interest ought to be enhanced from 6% per annum to 12% per annum. 16. There is no dispute before this Court that the amount deposited by the Appellant became refundable consequent upon the order of the Tribunal setting aside the demand. The Tribunal has treated the amount deposited ....
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.... accordance with Section 35FF of the Act and the notification issued thereunder, this Court cannot, in exercise of appellate jurisdiction under Section 35G of the Act, enhance the statutory rate of interest, merely because the Appellant considers it to be inadequate. Consequently, no substantial question of law survives for consideration. 20. Needless to observe, the aforesaid conclusion is confined to the scope of the present statutory Appeal. If the Appellant claims to have suffered any independent legal injury giving rise to such other remedy as may be available to it in accordance with law, the present judgment shall not be construed as expressing any opinion thereon. Those questions do not arise for consideration in the present proc....