2023 (2) TMI 664 - HC - Central Excise

Maintainability of petition - Enhancement of the interest awarded on the amount of refund - monetary limit involved in the appeal - HELD THAT - It is noted that an appeal involving a similar issue in COMMISSIONER OF CENTRAL TAX, CGST, DELHI EAST VERSUS BATRA HENLAY CABLES 2022 (11) TMI 796 - DELHI HIGH COURT where it was held that The Board, in its communication dated 19.10.2022 has indicated, that an SLP should not be filed, having regard to the monetary limit, keeping the question of law open in terms of Section 35R of the Central Excise Act, 1944. It is considered apposite to close this appeal as well on the ground that the tax effect is below the monetary limit as prescribed. Appeal disposed off.

Summary

Issues: Appeal against enhancement of interest rate on refund, Tax effect below monetary limit for appeal, Application for Special Leave Petition rejected, Contention of a question of law not covered by instructions, Appeal closed due to tax effect below monetary limit.

The judgment pertains to an appeal challenging an order passed by the Customs Excise and Service Tax Appellate Tribunal (CESTAT) allowing the respondent's appeal for an increase in the interest rate awarded on the refund amount. The respondent had deposited a significant sum during a specified period, and after investigations, a demand was confirmed, including a penalty. The respondent applied for a refund, which was granted without interest initially. Subsequently, on appeal, interest at 6% per annum was sanctioned. Dissatisfied, the respondent sought a higher rate of interest and appealed to the CESTAT, which increased the rate to 12% per annum.

The tax effect in this case was approximately below the threshold monetary limit for filing an appeal before the High Court. A similar issue had been disposed of in another case, and the proposal for a Special Leave Petition was rejected due to the lower effect on revenue. The Revenue filed an application seeking recall of the order in the related case, which was ultimately dismissed. The senior standing counsel highlighted that previous decisions were followed in similar appeals but argued that the present matter involved a question of law not covered by specific instructions.

The Court did not agree with the contention raised by the counsel, as a similar argument had been rejected in a previous case. Following the precedent, the Court decided to close the present appeal based on the tax effect falling below the prescribed monetary limit. Consequently, the appeal was closed in light of the above considerations.