2017 (11) TMI 146 - AT - Central Excise

Entitlement of interest - belated sanctioning of the refund claims - Held that - there was protracted litigation on the refund claims and sanctioning thereof by the lower authorities and the matter was settled by the Hon ble High Court in appellant s favor. The appellant having filed refund claims as early as in 1996-97 was correct in claiming the interest liability from the Revenue authorities under the provisions of Section 11B of Central Excise Act, 1944 - the appellant is eligible for the interest on the amount of refund claims after three months from the date of filing. Appeal allowed - decided in favor of appellant.

Summary

Issues:
Claim of interest on belated sanctioning of refund claims, Appeal against rejection of interest claim, Appealability of Assistant Commissioner's letter as an order.

Analysis:
1. Claim of Interest on Belated Refund Claims:
The appeal was centered on the appellant's claim for interest from the revenue department due to delayed sanctioning of refund claims. The appellant contended that as per Section 11B(2) of the Central Excise Act, 1944, they were entitled to interest on the refund amount after three months from the date of filing the refund claim. The appellant cited the precedent set by the apex court in the case of Ranbaxy Laboratories Ltd. (2011) to support their claim for interest on the delayed refund.

2. Appeal Against Rejection of Interest Claim:
The appellant argued that the Hon'ble High Court had ruled in their favor, holding them eligible for refunds and interest. The Revenue did not file any appeal or Special Leave Petition against this judgment. The first appellate authority had rejected the appeal on the grounds that the Assistant Commissioner's letter was not an appealable order. However, the appellant contended that as per settled law, any letter by the Assistant Commissioner is considered an order and is appealable. The appellant also highlighted the significance of the findings in the case of Chief Commissioner Central Excise, LTU vs. TNT Pvt. Ltd. (2010) where it was established that any letter impacting the rights of the assessee is an appealable order.

3. Appealability of Assistant Commissioner's Letter:
The issue of whether the letter written by the Assistant Commissioner was appealable was crucial in this case. The appellant argued that the letter was indeed an order and should be subject to appeal. Citing the precedent set by the Hon'ble High Court of Karnataka in the case of Chief Commissioner Central Excise, LTU vs. TNT Pvt. Ltd., the appellant contended that any communication by the authorities that affects the rights of the assessee is considered an appealable order. The Tribunal agreed with this argument, overturning the lower authority's decision that the letter was not an appealable order.

In conclusion, the Tribunal allowed the appeal, directing the authorities to pay the interest on the refund claims in accordance with the law established by the apex court. The judgment emphasized the importance of timely refund processing and the entitlement of the appellant to interest on delayed refund claims. The decision also clarified the appealability of letters issued by the Assistant Commissioner, aligning with established legal principles.