TaxTMI 
TaxTMI 
2026 (7) TMI 590
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....ould not be dismissed. The matter finally reached the Tribunal, which remanded the matter to the Adjudicating authority to go through all the documentary evidence and decide the issue. On 18.08.2021, the de-novo proceedings were completed and refund of Rs.3,60,910 was sanctioned without any interest thereon. The appellant filed an appeal before the Commissioner (Appeal) seeking interest, which came to be dismissed. Hence, the appellant is before the Tribunal. 2. The Ld Counsel, representing the appellant submits the chronology of the even as per the following Table: 16.09.2008 to 12.03.2012 The Appellant working with M/s Vedanta Aluminium Ltd. (VAL) as Manager-Corporate Communications with remuneration of Rs.55,000/- per month. 03.08.2012 The Jurisdictional Authorities took a view that the Appellant was providing "Management or Business Consultancy Service" and called upon the Appellant to pay service tax amounting to Rs.3,60,910/- on the remuneration received by her from VAL. 30.08.2012 Having been perturbed by such allegation of non-payment of tax, the Appellant paid Rs.3,60,910/-. 02.01.2013 The jurisdictional Authorities called upon the Appellant to p....
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....t submitted the relevant documents to the original Authority. 22.04.2022 The Appellant's appeal against the said communication of the jurisdictional Asst. Commissioner was disposed off by the Commissioner(A) with the finding that the Appellant is entitle to receive interest "from the date of expiry of three months from the date of receipt of Final Order of Tribunal till date of payment". 17.06.2022 The Appellant preferred the present appeal challenging the Order-in-Appeal dated 22.04.2022 on the ground that the relevant date for computation interest on delayed refund will be "three months after the date of receipt of the refund application" AND not "from the date of expiry of three months from the date of receipt of Final Order of Tribunal till date of payment". 3. He submits that the Service Tax demanded initially was without any authority of law. The appellant was not at all required to pay this amount. Only under severe pressure, she got herself registered with Service Tax Dept. and she paid the same. Subsequently, when the officials started demanding the interest, she consulted the experts in the field and came to know that no Service Tax was payable by her. Afte....
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....emuneration was not below the threshold limit and hence the Service Tax was correctly paid by her. I cannot understand as to how this stand can be taken in respect of the refund claim filed, when no SCN was issued, placing the grounds on which the Service Tax is payable in the first place. Therefore, even the rejection of the refund claim vide the OIO dated 16.12.2013 was void ab initio. 11. When the matter came up before the Commissioner (Appeals), he has mechanically dismissed it without even going into the factual verification. If he was vigilant, he should have found the error about non issue of SCN for appropriating the amount paid by the appellant, which has now been found by this Bench at this juncture. He should have gone into the issue as to how the refund can be questioned, when the liability to pay Service Tax itself was not at all raised by way of any SCN? 12. Unfortunately, even when the matter came up before the Tribunal, the issue was not canvassed by the appellant's counsel properly, because of which the matter was remanded to the Adjudicating authority by the Tribunal vide Final Order No.75318/18 dated 19.03.2018. 13. In spite of the remand order dated 19.....
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....und of the amount of Rs. 360910/- paid by her is admissible. 15. It is quite interesting to note that the initial demand of Service Tax was made purely based on account of 26AS without any SCN. Thetable containing Form 26AS reproduced above itself reflects that the amounts received is less than Rs.10 lacs threshold limit every year in question, applicable with effect from 1.3.2008. In order to get this Service Tax figure taking the rate of ST @ 12.36 prevailing at that point of time, the total consideration was taken as Rs.28 lacs and Service Tax demand was fixed at Rs.3,60,910. This has been done by simply totalling up all the four years figures, giving a complete go by to the threshold limit available for each of the years 2008-09 to 2011-12. This has been correctly noted in the findings by the judicious Assistant Commissioner passing the OIO. 16. However, this also shows that none of the officials involved right from the person setting up the demand of Rs.3,60,910, to the one asking for the interest thereon, to the one rejecting the refund claim to the one dismissing the Appeal, has ever applied their basic intelligence to go over the factual detail vis-à-vis the st....
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.... the Gujarat &Madhya Pradesh High Courts that compensation should be granted (whether called interest or otherwise) and hence the impugned judgment was contrary to a decision of this Court and ought to be reversed? E. Whether the High Court ought to have held that sections 240 and 244 of the Act refer to 'refund of any amount', which phrase clearly includes any amount (including interest) due by the Income Tax department to the assessee, and hence the appellant was entitled to interest on the delay in the payment of amounts due from the Income-tax department ? Provisions of Income Tax Act : 243. Interest on delayed refunds. (1) If the Income-tax Officer does not grant the refund (a) in any case where the total income of the assessee does not consist solely of income from interest on securities or dividend, within three months from the end of the month in which the total income is determined under this Act, and (b) in any other case, within three months from the end of the month in which the claim for refund is made under this Chapter, the Central Government shall pay the assessee simple interest at (twelve) per cent per ....
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....h all subsequent stages of proceedings and therefore is phrased in terms of 'any amount' becoming due to an assessee. The facts and the law referred to in paragraph (supra) would clearly go to show that the appellant was undisputably entitled to interest under Sections 214 and 244 of the Act as held by the various High Courts and also of this Court. In the instant case, the appellant's money had been unjustifiably withheld by the Department for 17 years without any rhyme or reason. The interest was paid only at the instance and the intervention of this Court in Civil Appeal No. 1887 of 1992 dated 30.04.1997. Interest on delayed payment of refund was not paid to the appellant on 27.03.1981 and 30.04.1986 due to the erroneous view that had been taken by the officials of the respondents. Interest on refund was granted to the appellant after a substantial lapse of time and hence it should be entitled to compensation for this period of delay. It is a case of the appellant as set out above in the instant case for the assessment year 1978-79, it has been deprived of an amount of Rs.40 lakhs for no fault of its own and exclusively because of the admittedly unl....
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.... the Consumer Welfare Fund but the relevant date is to be determined with reference to date of application laying claim to refund. The non-payment of refund to the applicant claimant within three months from the date of such application or in the case governed by proviso to Section 11BB, non-payment within three months from the date of the commencement of Section 11BB brings in the starting point of liability to pay interest, notwithstanding the date on which decision has been rendered by the competent authority as to whether the amount is to be transferred to Welfare Fund or to be paid to the applicant needs no interference." The special leave petition is dismissed. No costs." 14. At this stage, reference may be made to the decision of this Court in Shreeji Colour Chem Industries (supra), relied upon by the Delhi High Court. It is evident from a bare reading of the decision that insofar as the reckoning of the period for the purpose of payment of interest under Section 11BB of the Act is concerned, emphasis has been laid on the date of receipt of application for refund. In that case, having noted that application by the assessee requesting for refund, was filed b....
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....ation for refund on 30-12-1999 and, therefore, the statutory interest ought to commence after non-payment within three months from the date of application, being the starting point envisaged by Section 11BB of the Act. We find no reason to deviate from the view so taken in Ranbaxy Laboratories Ltd. (supra). 5. Hence, this appeal should succeed. The claim of the appellant regarding statutory interest under Section 11BB of the Act is allowed in the above terms. The amount be calculated and paid expeditiously and not later than three months from today. The impugned judgment of the High Court in this regard is set aside. Appeal is allowed in the aforementioned terms. There shall be no order as to costs. Gujarat High Court Hindustan Coca-Cola Beverages Private vs Union Of India Civil Application No.15012 of 2005 Judgement dated 02.04.2013 1.2 The Petitioner was aggrieved by order dated 11.04.2005 passed by the Commissioner, whereby the claim of the petitioner, for interest on the ground that there was no provision empowering the department to pay interest on the MODVAT/CENVAT claim withheld by the Department s inaction, was rejected.....
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....gic was that there was no statutory provision enabling the department to pay such interest to the petitioner. 5.3 This Court is of the considered opinion that the entire approach is wholly erroneous. ............... The only inescapable conclusion that we can reach is that the respondents had no reason to deny the transfer of the unutilized credit to the petitioner on merger. They had no authority to withhold such amount in law. In that view of the matter, it would be highly unjust to permit the respondents to hold on to the petitioner's money for nearly 5 years without any interest at all as it would amount to Revenue taking advantage of its own wrong of withholding the permission for transfer of credit. 8. Under the circumstances, this Court is of the opinion that the order of the Commissioner disentitling the petitioner of any interest on the amount is required to be set aside. The same is accordingly set aside. 9.1 The department shall also pay 6% simple interest per annum on the interest so quantified as per directions contained in para 9 above. This interest should also be paid within a period of one month from the date of receipt of this judgme....