2006 (7) TMI 415 - AT - Central Excise

Summary

Issues:
Claim for interest on Modvat credit availed by the appellant.

Analysis:
The appeal was against an order rejecting the claim for interest by the appellant on Modvat credit. The appellant debited an amount under protest on the persuasion of range officers, leading to a show cause notice for appropriation and penalty. After a series of appeals and remands, the adjudicating authority set aside the proceedings and granted the appellant credit. The appellant then claimed interest on the amount, which was rejected, leading to this appeal.

The appellant argued that Section 11BB provisions for interest on amounts illegally retained by the revenue applied in this case. They contended that debiting the amount under protest indicated disagreement with the range officers and that they claimed refund with interest in response to the show cause notice, making the revenue liable for interest.

On the other hand, the Revenue argued that interest was not applicable as no refund claim was filed by the appellant, and the credit was granted by the adjudicating authority without a refund claim.

The tribunal examined the provisions of Section 11BB and Section 11B(1) and (2) of the Central Excise Act. It noted that interest could only be demanded under Section 11BB on a refund order under Section 11B(2). Since no refund claim was filed by the appellant, there was no order rejecting or allowing the claim, making them ineligible for interest.

Therefore, the tribunal found no grounds to interfere with the impugned order, leading to the dismissal of the appeal.