2017 (4) TMI 1265 - AT - Service Tax

Interest on refund - case of Revenue is that the claim was not perfected even with respect to the exact amount of eligibility and till date the amount of eligible refund is not quantified and when the amount of eligible refund is not quantified, award of interest by considering the date of filing of the refund claim is not warranted - Held that - the issue is squarely covered in favour of the appellant by the decision of the Supreme Court in the case of Ranbaxy Laboratories Ltd. 2011 (10) TMI 16 - Supreme Court of India , where it was held that liability of the revenue to pay interest under Section 11BB of the Act commences from the date of expiry of three months from the date of receipt of application for refund under Section 11B(1) of the Act and not on the expiry of the said period from the date on which order of refund is made - appeal dismissed - decided against Revenue.

Summary

Issues: Appeal against grant of interest on refund claim amount.

Analysis:
- The appeal was filed by the department against the order passed by the Commissioner (Appeals) granting interest on the refund claim amount.
- The respondent assessee had filed a refund claim for unutilized Cenvat Credit on input services utilized towards taxable services exported during a specific period.
- The original adjudicating authority had rejected the refund claim, leading the assessee to appeal before the Commissioner (Appeals), who allowed the appeal.
- The Revenue contended that the impugned order was not sustainable, emphasizing that the eligible refund amount had not been quantified, and therefore, the grant of interest was unwarranted.
- The counsel for the assessee relied on the judgment of the Supreme Court in the case of Ranbaxy Laboratories Ltd, arguing that the issue was settled law based on subsequent decisions by various courts.
- The Appellate Tribunal, after considering the arguments and the judgments cited, found that the issue was squarely covered in favor of the appellant by the Supreme Court's decision in the case of Ranbaxy Laboratories Ltd.
- Consequently, the Tribunal held that there was no merit in the Revenue's case and dismissed the appeal filed by the Revenue.