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2018 (5) TMI 865 - AT - Central ExciseRate on interest on refund claims - Held that - the rate prescribed under the law is 6%. If that be so, the Tribunal being a creature of Statute, cannot go beyond the rate of interest as prescribed under law - appeal dismissed - decided against appellant.
Issues Involved: Rate of interest on refund claims under Section 11BB of Central Excise Act, 1944.
Analysis: 1. Issue of Rate of Interest: The main issue in the appeal was the rate of interest at which the appellants' refund claims should be sanctioned. The appellants had claimed interest at 12%, but the Commissioner (Appeals) rejected this claim, stating that the interest should be calculated at 6% as prescribed under a Notification issued under Section 11BB of the Central Excise Act, 1944. The appellant's argument for a higher rate was deemed unacceptable as there was no legal basis or notification supporting a 12% interest rate. 2. Legal Interpretation: The Tribunal, represented by Ms. Archana Wadhwa, emphasized that the rate of interest on refunds is statutorily fixed at 6% per annum as per the Notification issued under Section 11BB of the Central Excise Act, 1944. The Tribunal clarified that it cannot exceed the prescribed rate of interest set by law, even if the appellant insists on a higher rate without providing any legal backing for their claim. 3. Precedent and Ruling: The Tribunal referred to a decision by the Karnataka High Court in a similar case, where it was held that the rate of interest on refunds under Section 11BB should be in accordance with the prescribed rate of 6% per annum, and not higher rates claimed by the appellant. The Tribunal upheld the lower authorities' decision, concluding that the impugned order rejecting the appellant's claim for a 12% interest rate was valid and the appeal was consequently dismissed. In summary, the judgment clarified that the rate of interest on refund claims under Section 11BB of the Central Excise Act, 1944 is fixed at 6% per annum as per the statutory Notification. Any claims for a higher interest rate without legal basis cannot be entertained, and the Tribunal must adhere to the prescribed rate set by law. The decision was based on legal provisions and precedents, ultimately upholding the lower authorities' ruling on the issue of the interest rate for the appellant's refund claims.
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