2007 (10) TMI 35 - AT - Central Excise

Once the adjudication order is set aside by Tribunal, amount of pre-deposit should be refunded with in 3 months if stay is not granted Tribunal allowed appeal by setting aside Comm(A) order on 9.11.01 So interest is payable from 9.11.01

Summary

Issues:
1. Clubbing clearances and duty recovery for work done on job work basis.
2. Refund request for amount paid in compliance with stay order.
3. Denial of exemption benefit leading to duty demand and refund adjustment.
4. Interest on delayed refund of pre-deposit post Tribunal's order.

Analysis:

1. The case involved a Show Cause Notice (SCN) issued to the appellants for clubbing their clearances with two other concerns and proposing duty recovery for failing to pay duty on job work basis. The Commissioner upheld the charges and demanded duty of Rs. 1,11,54,234/- with an equal penalty. The Tribunal set aside the clubbing but upheld the duty liability on job work basis, remanding the case for duty requantification.

2. The appellants requested a refund of the amount paid in compliance with the stay order. The Supreme Court dismissed the revenue's appeal against the Tribunal's order. Following a remand order, the Commissioner confirmed a duty demand of Rs. 9,27,317/- by denying exemption benefit, sanctioning a refund of Rs. 27 lakhs, adjusting Rs. 19,81,729/- against the demand, leading to appeals and remands for computation of duty liability.

3. The Tribunal accepted the contention that exemption was available for job work clearances, leading to a remand for duty computation. The Commissioner ordered a refund of the appropriated amount but denied interest, citing duty liability determination and refund sanction dates.

4. The Tribunal, considering legal precedents, found merit in the appellants' claim for interest on delayed refund post Tribunal's order setting aside the Commissioner's decision. Refund of pre-deposit within three months from Tribunal's order was mandated, and interest was deemed payable to the appellants for the delayed refund period.

In conclusion, the Tribunal allowed the appeal, directing the payment of interest to the appellants for the delayed refund of pre-deposit amount post the Tribunal's order setting aside the Commissioner's decision.