2004 (3) TMI 260 - AT - Central Excise

Summary

Issues:
1. Denial of interest on the refunded amount of Rs. 10 lakhs pre-deposited under Section 35F of the Central Excise Act.

Analysis:
The appeal before the Appellate Tribunal CESTAT, New Delhi was centered around the denial of interest on a refunded amount of Rs. 10 lakhs that was pre-deposited by the appellants under Section 35F of the Central Excise Act. The appellants contended that they were entitled to interest on the pre-deposit amount from the date of expiry of three months from the receipt of the Final Order of the Tribunal until the date of payment. The counsel for the appellants relied on a previous decision of the Tribunal in Sharda Synthetics Ltd. v. CCE [2003 (156) E.L.T. 730] to support their argument.

The Tribunal noted that the facts of the case were not in dispute, and the issue at hand was covered by the decision in Sharda Synthetics. It was held that the appellants were indeed entitled to interest on the pre-deposit amount from the date of expiry of three months from the receipt of the Final Order of the Tribunal until the date of payment. In this case, the Final Order was received by the party on 12-3-1998, and subsequently amended by a Misc. Order dated 9-10-1998. The interest on the pre-deposit amount was to be calculated from 12-6-1998 (three months from the receipt of the Final Order) to 30-12-1999, the date of refund. The Tribunal ordered the payment of interest within two months from the receipt of a certified copy of the order.

Consequently, the impugned order denying interest was set aside, and the appeal was allowed in favor of the appellants. The Tribunal directed the payment of interest on the refunded amount of Rs. 10 lakhs in accordance with the principles established in the Sharda Synthetics case.