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2018 (6) TMI 1675 - AT - Service TaxInterest on Refund of pre-deposit - refund made during the investigation of the case, after three months from the date of application for refund or after three months from the date of communication of the order - Section 35FF of Central Excise Act, 1944 - HELD THAT - From Section 35FF, it is clear that whatever deposit was made shall be considered as pre-deposit and the refund of the same is governed by Section 35FF. Section 35FF does not discriminate to deposit made prior to enactment of Section 35FF or thereafter. Therefore, for deposit which is to be refunded shall be governed by Section 35FF. When the refund arose consequence to the order passed by this Tribunal in appellant s demand case, Section 35FF was very much in existence. Therefore, any refund of pre-deposit shall be governed by Section 35FF during the relevant period. Section 35FF clearly stipulates that if the refund is not granted within three months from communication of the order by the Appellate Authority, unless the order is stayed by higher forum the Revenue is under obligation to pay the interest from three months of the communication of the order - Therefore, the date of filing refund application is not significant in the present case. There are no infirmity in the order of the Ld. Commissioner (Appeals) granting the refund of interest on refund already sanctioned - appeal dismissed - decided against Revenue.
Issues:
Entitlement to interest on refund of pre-deposit under Section 35FF of Central Excise Act, 1944. Analysis: The main issue in the present case revolves around the entitlement of the appellant to interest on the refund of a pre-deposit made during the investigation of the case. The specific question is whether the interest is payable after three months from the date of the refund application or after three months from the date of communication of the order, as per Section 35FF of the Central Excise Act, 1944. The Ld. Superintendent (AR) representing the Revenue argues that the interest provision of Section 35FF applies to the refund in question, as it pertains to a deposit made during the insertion of Section 35FF. According to this provision, interest is only payable after three months from the date of the refund application. As the refund in this case was sanctioned within three months from the date of the refund application, the Ld. Superintendent contends that no interest is payable on the deposit made during the investigation. In absence of representation from the respondent, the tribunal carefully evaluates the submissions made by the Ld. AR and reviews the records. The tribunal notes that the Ld. Commissioner considered the refund of interest in accordance with Section 35FF of the Central Excise Act, 1944. Section 35FF specifies the conditions for refunding amounts deposited by the appellant, requiring the payment of interest if the refund is not granted within three months from the communication of the order by the Appellate Authority. The tribunal emphasizes that Section 35FF applies to all deposits to be refunded, regardless of when they were made, and mandates the payment of interest if the refund is delayed beyond three months from the communication of the order. Consequently, the tribunal upholds the order of the Ld. Commissioner (Appeals) granting the refund of interest on the already sanctioned refund. The tribunal dismisses the Revenue's appeal, affirming that the refund of pre-deposit falls under the purview of Section 35FF, and interest is payable if the refund is not granted within three months from the communication of the order by the Appellate Authority. The judgment was pronounced in open court on 26-6-2018.
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