2007 (11) TMI 424 - HC - Central Excise

Interest on delayed refund - refund claim sanctioned by Deputy Commissioner - assessee was entitled for refund. After sanctioning the refund the said amount was appropriated for other dues - no merit in this appeal - appeal is dismissed

Summary

Issues:
1. Justification of directing the appellant to pay interest on refund during a pending lis before appellate authorities.

Analysis:
The High Court heard the appeal challenging the Customs, Excise and Service Tax Appellate Tribunal's order directing the appellant to pay interest on refund during a pending lis. The respondent filed a refund claim after CEGAT set aside duty levied upon them. The Deputy Commissioner sanctioned the refund but appropriated it towards other dues, which was later set aside by CEGAT. The key issue was determining the date of refund sanction - whether on 18-7-2000 or later due to CEGAT's remand order on 20th September 2000.

The High Court found that the Deputy Commissioner, as the adjudicating authority, held on 18-7-2000 that the assessee was entitled to the refund. Since the amount was appropriated for other dues, it was clear that the assessee would have received the refund immediately if there were no other dues. The court rejected the revenue's argument that the refund order should be considered effective from 30-1-2001, emphasizing that the refund was due to the assessee on 18-7-2000 itself.

Therefore, the High Court concluded that no substantial question of law arose in the appeal. The court dismissed the appeal, stating that the assessee was entitled to the refund from 18-7-2000, and there was no merit in the revenue's arguments.