2008 (10) TMI 512 - AT - Central Excise

Summary

Issues involved: Appeal against rejection of interest on refund of duty deposited u/s 11B of Central Excise Act, 1944.

Summary:
The appellant appealed against the rejection of interest on a refund of Rs. 3,30,663 deposited during a specific period. The Adjudicating Authority had confirmed the duty demand, which was later challenged by the appellants in various courts leading to a favorable decision by the Hon'ble Supreme Court in 2002. Subsequently, a refund application was filed and granted, followed by a claim for interest on the refund amount. The Dy. Commissioner of Central Excise rejected the interest claim citing that the principal amount was refunded within the prescribed time limit u/s 11B and that interest was not applicable due to the matter being sub-judiced until November 2002. The Commissioner of Central Excise (Appeals) upheld this decision.

Upon hearing both sides, it was argued that since the duty was paid during a specific period and the matter was finally decided in favor of the appellants by the Hon'ble Supreme Court, they were entitled to interest on the amount. Legal precedents were cited to support this argument. However, the Commissioner (Appeals) based the decision on a Supreme Court case stating that pre-deposit made for hearing an appeal is refundable with interest if the assessee is successful, with interest payable from 3 months after the final disposal of the dispute on merit. The appellant's reliance on a different case was deemed inapplicable, and the appeal was rejected, upholding the Commissioner (Appeals) decision.

In conclusion, the appeal against the rejection of interest on the refunded duty amount was dismissed based on the interpretation of relevant legal provisions and precedents cited by both parties.