2024 (6) TMI 377 - AT - Central Excise

Wrong availment of Cenvat Credit on Inputs - denial of interest on deposited amount - payment of compensatory interest on interest - HELD THAT - The contention of the Appellant that the amount deposited during investigation will be entitled to refund along with interest agreed upon. Such amount deposited is neither duty nor interest. The impugned order passed by the learned Commissioner (Appeals) is set aside as far as denying the interest on Rs.18,07,914/- and appeal is allowed. The Adjudicating Authority is directed to grant interest upon the said amount, from the date of deposit till the date of grant of Rs.18,07,914/- @ of 12% per annum. Such interest should be given to the Appellant within a period of Ninety days from the date of receipt of copy of this order. Appeal allowed.

Summary

Issues involved: Wrong availment of Cenvat Credit on inputs, denial of interest on deposited amount, entitlement to interest on refund amount.

Summary:
1. The Appellant, engaged in manufacturing MS Bars and Rods, availed Cenvat Credit based on allegedly fake invoices, leading to a demand for repayment and penalties.
2. After a series of appeals and orders, the Tribunal allowed the appeal and directed a refund of the deposited amount of Rs.57,30,616, but interest on the amount was disputed.
3. The Appellant contended that the deposited amount, including interest, was paid under pressure and sought interest on the full sum.
4. Relying on legal precedents and a CBEC Circular, the Tribunal held that the deposited amount is eligible for refund with interest, directing the Adjudicating Authority to grant interest on the disputed sum of Rs.18,07,914 at 12% per annum within ninety days.

(Order pronounced in open court on 07th June, 2024)