2007 (3) TMI 525 - AT - Central Excise

Summary

Issues:
1. Application to delete interest on seized goods from the impugned Order.
2. Dispute over awarding interest at 9% per annum on sale proceeds of seized goods.
3. Maintainability of the application for review of the Order.
4. Interpretation of CESTAT Procedure Rules regarding inherent powers to pass orders in the interest of justice.

Analysis:
1. The Department filed a miscellaneous application seeking to remove the interest on seized goods from the Order dated 24-3-2006. The Tribunal's impugned order released the seized gold biscuits and directed the return of sale proceeds with 9% interest from the date of seizure. The Department did not challenge the order's merits but objected to awarding interest on the sale proceeds, citing a previous case to support their stance.

2. The Department argued that there is no provision in the Customs Act, 1962, to grant interest on refund related to sale proceeds or confiscated goods. In response, the respondents contended that the application for deleting interest would amount to a review of the Order, which they deemed as not maintainable. They invoked Rule 41 of CESTAT Procedure Rules, asserting the Tribunal's inherent powers to issue necessary orders in the interest of justice, citing precedents where interest was awarded in similar circumstances.

3. The Tribunal, after evaluating the arguments and the application, found no apparent error on the record. It held that once the Department accepted the impugned order on its merits, they could not object to the grant of interest in the absence of specific provisions. The Tribunal ruled in favor of the respondent, stating that the interest amount was due in the interest of justice and equity, aligning with prevailing practices. Consequently, the Tribunal rejected the appellant's application, emphasizing the entitlement of the respondent to the interest amount.

This detailed analysis of the judgment addresses the issues raised in the case, outlining the arguments presented by both parties and the Tribunal's reasoning leading to the final decision.