2017 (1) TMI 701 - AT - Central Excise

Interest on delayed refund - Section 11BB of CEA, 1944 - time limitation - supplementary / additional claim of refund amount - Held that - the Hon ble Supreme Court in the case of Ranbaxy Industries Ltd. Vs. UOI 2011 (10) TMI 16 - Supreme Court of India , observed that interest is payable after expiry of three months from the date of filing of the refund claim - the appellants are eligible to interest on ₹ 6,13,406/- on expiry of three months from the date of filing of the refund claim till the same was paid to them. Regarding the amount of ₹ 3,62,729/-, I find that the same was claimed for the first time on 24.4.2006 with a request to revise the earlier refund claim of ₹ 6,13,406/- to ₹ 9,76,135/- - Held that - merely because the refund claim of ₹ 6,13,406/- had been pending beyond three months, it cannot provide a right to the appellant to revise the claim antedated by including additional amount of ₹ 3,62,729/-, which was not because of any arithmetical error in calculation but arose on account of separate payments earlier i.e. between July 2004 and January 2005 - the authorities below had rightly held that the additional amount of ₹ 3,62,739/- claimed through letter 24.4.2006 could not be considered as the claim filed on 11.7.2005 and rejected the same claim on the ground of limitation. Appeal disposed off - decided partly in favor of appellant.

Summary

Issues: Refund claim rejection, interest payment, limitation period, revision of refund claim.

Refund Claim Rejection:
The appellant filed a refund claim for ?6,13,406 on the grounds of initially paying Education Cess under the wrong head. A show cause notice was issued proposing rejection of the claim. The claim under Section 11B of CEA, 1944 was sanctioned without interest, while an additional claim of ?3,62,729 was rejected due to being hit by the limitation period. The appellant appealed against this decision, arguing that interest should be paid for the delayed refund.

Interest Payment:
The appellant contended that interest was payable for the delayed period of refund of ?6,13,406, as it was refunded three months after the claim was filed. The relevant provision for interest on delayed refunds is Section 11BB of CEA, 1944. The Hon'ble Supreme Court in Ranbaxy Industries Ltd. Vs. UOI clarified that interest is payable after three months from the date of filing the refund claim.

Limitation Period:
The Revenue argued that the additional claim of ?3,62,729, filed separately, could not be considered along with the initial claim as they were made on different dates. The authorities held that the additional claim was beyond the limitation period and rejected it. The appellant's attempt to revise the claim by including this amount was deemed not valid.

Revision of Refund Claim:
The appellant sought to revise the refund claim from ?6,13,406 to ?9,76,135 by including the additional amount of ?3,62,729. However, the Tribunal found that the additional amount arose from separate payments made earlier and could not be included in the original claim. The authorities were correct in rejecting this part of the claim based on the limitation period.

In conclusion, the Tribunal modified the impugned order, partially allowing the appeal for interest on the claim of ?6,13,406 for the delayed period. The additional claim of ?3,62,729 was not considered within the original claim's scope and was rightly rejected based on the limitation period.