TaxTMI 
TaxTMI 
2026 (8) TMI 1085
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....149 of the Customs Act, 1962. 2. The Revenue has also filed an appeal being aggrieved by the order of the Ld. Commissioner (Appeals), who held that the interest is payable from 20.02.2019. The Ld.A.R. for the Revenue submits that since the reassessment order was passed on 17.09.2025, the respondent should be allowed interest only from that date. He also opposes the submission of the importer to enhance the interest to 12%. 3. The Ld. Counsel appearing for the appellant submits that the issue pertains to the classification of the Yellow / Green peas imported by the appellant under 5 Bills of Entry during the period December 2017 to February 2018. Initially, the appellant cleared the goods on payment of the Customs Duty claiming the benefit of 50% of the Basic Duty. After coming to know that the goods in question would be eligible for NIL rate of Customs Duty in terms of Notification No.93/2017 Cus dated 21.12.2017, they filed their request for re-assessment of Duty in terms of this Notification on 18.09.2018, seeking remedy under Section 149 of the Customs Act 1962. Since no response was received towards their request, the appellant filed a Refund claim on 19.11.2018. This ref....
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....may be dismissed. 7. In the rejoinder, the Ld. Counsel appearing for the importer, submits that the chronological history of the case would clarify that the appellant has been pressing for re-assessment right from 2018 onwards. They have filed the refund claim in the year 2019 itself. Once, the Tribunal has decided the issue in favour of the importer about the classification and applicability of the exemption Notification, unless it is overturned by the Supreme Court [which incidentally dismissed the SLP filed by the Revenue on this issue], the lower authorities were bound to re-assess the B/E accordingly. The re-assessment is required to be taken as if the same is effective from the date when the initial B/E was presented. Hence, he justifies the refund granted by the Commissioner (Appeals) with effect from 20.02.2019. He submits that as a matter of fact, the appellant should be made eligible for the interest from time the request for reassessment was made on 18.09.2018. Accordingly, he prays that the appeal filed by the Revenue may be dismissed. 8. Heard both the sides and considered their submissions. 9. It would be pertinent to go through the chronological table of the....
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.... Department preferred an appeal Against CESTAT Final Order 777256 -777262 /2023 before the Hon'ble SUPREME COURT OF INDIA [Final Order which was already accepted - so the adjudication order was kept in abeyance] 26.03.2025 Hon'ble Supreme Court Order [on similar matter] Departmental Appeal was disposed of on merit and time barred ground 09.05.2025 PH Letter given PH letter given for deciding case and issuing adjudication order PH date - 30.07.2025 29.07.2025 Order-in-Original Adjudication order was passed allowing the claim of the importer for amendment and reassessment of Bill of Entry 17.09.2025 Corrigendum issued To rectify the mistake in the OIO 28.10.2025 Bill of Entry Reassessed The Bills of Entry were reassessed in ICES 04.11.2025 Refund Application under Section 27 Refund Application submitted online vide ARN No. ARNIG07112025132200007 07.11.2025 Refund order OIO No. KOL/CUS/AC/ARS (PORT)/937/2025 and Refund Order No. 193/2025 was issued [amount sanctioned - Rs.2,89,56,399/- 01.12.2025 Refund issue taken up with ICEGATE vide Ticket No. IM04379340 and Principal Commissioner of Customs (Port0 Mail se....
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....023 dated 12.10.2023 in respect of identical goods, still the matter was taken up to the Supreme Court level. After the issue stood decided at Apex Court level, some more years were spent on re-assessment order being passed and refund being granted. However, the refund was granted for the basic differential duty alone. The factual details proves that ultimately the Revenue was wrong in their classification. The importer was once again required to knock the doors of higher forum to get the interest fructified. The Commissioner (Appeals) has gone through the factual details and after noting that the refund claim was filed on 18.11.2018, he has allowed the three months' free period and after that he has held that the interest would be payable with effect from 20.02.2019. 12. It would be pertinent to go through some of the important judgements on the issue as to from which date the interest would accrue. We have for reference the following case laws: 2012 (27) S.T.R. 193 (S.C.) [21-10-2011] RANBAXY LABORATORIES LTD. Vs UNION OF INDIA "14. At this stage, reference may be made to the decision of this Court in ShreejiColour Chem Industries (supra), relied upon by the Delhi ....
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....d is made? 9. Presently to the flash back. In pursuance of the order passed by the competent authority, an amount of Rs. 3,74,00,000/- was refunded by cheque No. 639266 dated 15-11-2000 payable at PNB Navyug Market, Ghaziabad. As no interest was paid by the appellant, the respondent filed a Civil Miscellaneous Writ Petition No. 249 of 2001 before the High Court of Judicature at Allahabad [2005 (188) E.L.T. 476 (All.)]. The Division Bench, considered the judgment rendered by this Court in Civil Appeal No. 7766 of 1995, took note of the time prescribed for disposal of the application for refund, the language employed in Section 11BB of the Central Excise Act, 1944 (for short, 'the Act') and further appreciating the conduct of the parties, opined that the liability for payment of interest is statutory and it is the bounden duty of the Assistant Commissioner to pay interest from 26th November, 1999 till 15th November, 2000 at the rate specified under Section 11BB of the Act. The aforesaid conclusion impelled the Division Bench to allow the writ petition with costs which was assessed at Rs. 10,000/-. The said order is the subject matter of appeal by special leave. 17. ....
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....CESTAT has decided appeal so filed, vide impugned Final Order No. 50125/2024 dated 11-1-2024 wherein learned CESTAT has allowed the appeal and held that respondent is entitled for the interest on the amount of refund sanctioned at the rate of 12% to be calculated from the date of payment till the date of disbursement. 11. Learned counsel for the appellant contended that the learned CESTAT has erred in coming to the conclusion that the refund claimed by the respondent is governed under section 11 B and 11 BB of Central Excise Act, 1944 (which shall be referred hereinafter as "Act, 1944"), whereas the aforesaid provisions governs such refund of duty amount. In fact the Tribunal failed to consider that such refund is governed under section 11 B of the Act, 1944, since it pertained to refund of duty amount paid by the respondent in compliance of an order of Adjudicating Authority. So also the interest on delay payment of refund is governed by Section 11 B of the Act, 1944. He submits that learned Tribunal has misinterpreted the Apex Court ruling in case of Mafatial Industries Ltd. v. Union of India 1997 (89) EL.T. 247 (S.C.) as well as in the case of Sandvik Asia Ltd v. Commis....
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.... modification was rejected. According to the Tribunal, the deposit was made at a time when no quantified claim had been made on the assessee. On such basis, the Tribunal found that the deposit had not been made on account of any duty or interest which would attract the implied bar under section 118 of the Act. It was a put sible view taken on the set of facts that presented themselves before the Tribunal and, in this appellate jurisdiction. This interpretation does not call for any interference. Further, as to the quantum of interest awarded, the Tribunal, which is specialised body dealing in matters pertaining to excise duty, took into account the previous judgments of the Supreme Court, High Courts and the Tribunal itself to justify that the rate of 12 per cent per annum would apply in the facts of the present case. Again, since there is some basis to the award of interest by the Appellate Tribunal, the same does not call for any interdiction." 2022 (62) G.S.T.L. 136 (P & H) COMMISSIONER OF CENTRAL EXCISE, PANCHKULA Vs RIBA TEXTILES LTD. "9. While deciding the issue of interest, Ld. Tribunal has relied upon the law laid down by the Apex Court in Sandvik Asia Ltd. v. C....
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....usly affected the administration of justice and the rule of law. COMPENSATION : 46. The word 'Compensation' has been defined in P. Ramanatha Aiyar's Advanced Law Lexicon 3rd Edition 2005 page 918 as follows : "An act which a Court orders to be done, or money which a Court orders to be paid, by a person whose acts or omissions have caused loss or injury to another in order that thereby the person damnified may receive equal value for his loss, or be made whole in respect of his injury; the consideration or price of a privilege purchased; something given or obtained as an equivalent; the rendering of an equivalent in value or amount; an equivalent given for property taken or for an injury done to another; the giving back an equivalent in either money which is but the measure of value, or in actual value otherwise conferred; a recompense in value; a recompense given for a thing received recompense for the whole injury suffered; remuneration or satisfaction for injury or damage of every description; remuneration for loss of time, necessary expenditures, and for permanent disability if such be the result; remuneration for the injury directly and proximately ca....
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....tral Excise Act, 1944 are pari materia and, therefore, law laid down by the Supreme Court in the case of Sandvik Asia Ltd. (supra) shall be applicable to the present case. 10. Ld. Counsel for the appellant is not in a position to deny the proposition of law laid down in the case of Sandvik Asia Ltd. (supra) and the applicability thereof to the facts of the present case." 2022 (380) E.L.T. 219 (Tri.-All) PARLE AGRO PVT. LTD. Vs COMMISSIONER, CGST, NOID "39. In this connection reference can also made to the decisions of the Allahabad High Court in Pace Marketing Specialities and Ebiz.Com Private Limited, wherein after making reference to the decision of the Supreme Court in Sandvik Asia Ltd., the High Court granted interest at the rate of 12% per annum in matters relating to refund of amount deposited during investigation and adjudication. 40. In Riba Textiles, the Tribunal also granted interest at the rate of 12% on refund of amount deposited during investigation and at the time of entertaining the stay application. 41. In view for the aforesaid decisions, and the fact that the rate of interest varies from 6% to 18% in the aforesaid Notificatio....
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....or rate of interest on delayed refund of pre-deposit. With effect from the date on which the provision came in the statute, it shall hold the field and the rate of interest shall be governed by it. Since the period in question is prior to the notification providing for rate of interest on delayed refund of pre-deposit, issued under the Act, therefore, the case of the appellant shall be governed by the law laid down by the coordinate Bench of this Court in Madura Coats Private Limited (supra). 5.2. From the decision of the Hon'ble High Court extracted above, we find that the Hon'ble High Court has categorically held that interest @12% is payable in respect of refund of amount deposited during the course of investigation. In this regard, we find that there are different decisions by various High Courts on the issue of refund of the amount deposited during the course of investigation. However, the decision of the Jurisdictional High is binding on the Tribunals falling within it's jurisdiction, as held by the Larger Bench in the case of Collector of Central Excise Chandigarh vs. Kashmir Conductors - 1997 (96) E.L.T. 257 (Tribunal), wherein it is held as under: "10. Th....