2013 (11) TMI 883 - AT - Central Excise

Interest on Rebate claim Held that - The refund claim sanctioned but adjusted against the confirmed demands where the said confirmed demand are subsequently set aside, the assessee would be entitled to the interest from the date of expiry of three months from the date of filing refund claim Following Intas Pharmaceuticals Ltd. Vs. CCE, Ahmedabad 2011 (8) TMI 354 - CESTAT AHMEDABAD as per section 11BB of Central Excise Act, 1944 if the refund claims filed are not sanctioned within three months, the Revenue is under legal obligation to pay interest till the date the same are actually given to the assesse - they would be entitled to get interest from the date of expiry of three months from the date of filing of refund claim - Decided in favour of Assessee.

Summary

Issues:
Appeal against rejection of interest claims on rebate claims.

Analysis:
The judgment pertains to multiple appeals arising from the same impugned order by the Commissioner (Appeals) rejecting interest claims on rebate claims. The Assistant Commissioner had initially sanctioned the rebate claims but adjusted them against outstanding confirmed demands, which were later set aside by the Tribunal. The Tribunal had noted the violation of the statutory right to appeal and stay of recovery due to the premature adjustment of the demands. Subsequently, the rebate claims were sanctioned, but the interest claims were not entertained, leading to the current appeal.

Upon hearing both parties, the Tribunal considered whether the appellants were entitled to interest from the date of expiry of three months from filing the rebate claim or from the date of the Tribunal's order setting aside the demands. The Tribunal emphasized that as per the provisions of section 11BB of the Central Excise Act, 1944, if refund claims are not sanctioned within three months, the Revenue is obligated to pay interest until the actual refund is given to the assessee. The Tribunal referred to various precedents and decisions to support the entitlement of interest from the expiry of the three-month period from filing the refund claim.

Based on the legal provisions and precedents cited, the Tribunal concluded that the issue of interest on rebate claims had been settled by previous decisions. Therefore, the appellants were deemed entitled to receive interest from the date of expiry of three months from filing the refund claim. The lower authorities were directed to calculate and quantify the interest accordingly. Consequently, all the appeals were disposed of in favor of the appellants, in line with the settled legal principles and precedents cited during the proceedings.