2015 (6) TMI 504 - AT - Central Excise

Refund claim - Interest on delayed refund - Held that - Refund claim was filed on 19/2/2009 and same was sanctioned on 30/9/2009. Hence there is apparent delay in sanctioning refund claim. It is observed that the refund is against pre-deposit of amount as directed by the Tribunal in some other matter. Appellant filed refund claim alongwith self-attested copies of TR-6 Challan and same was sufficient for sanctioning the refund claim for simple reason that the pre-deposit was ordered by the Tribunal and the same was deposited and Tribunal has accepted the compliance of such deposit. Therefore there is absolutely no dispute as regard deposit of such amount. In such circumstances the self attested copy of TR 6 Challan were sufficient for sanctioning of refund claim of pre-deposit amount within the stipulated time period of three months. - Moreover if the sanctioning authority is of view that the departmental attested copies of TR6 Challan are required he could have asked the same well within the time period of three months which he failed to do. - appellant is legally entitled for interest on the refund claim for the period beyond three months from the date of filing of application of refund till the sanction of refund claim in terms of 11BB of Central Excise Act 1944 - Decided in favour of assessee.

Summary

Issues:
1. Delay in sanctioning refund claim.
2. Entitlement of appellant for interest on delayed refund.

Analysis:
1. The appeal was filed against the rejection of the refund claim by the Commissioner. The appellant had filed a refund claim of Rs. 90 lakhs under Section 11B of the Central Excise Act, 1944, against a pre-deposit made as per CESTAT direction. The refund was sanctioned after a delay beyond the prescribed three-month period. The appellant appealed for interest on the delayed refund, which was rejected by the Commissioner.

2. During the hearing, the appellant did not appear, and the appeal was disposed of on merit. The Assistant Commissioner representing the Revenue stated that the delay in sanctioning the refund was due to the appellant's failure to submit attested TR-6 challans. The Revenue argued that since the delay was on the part of the appellant, they were not entitled to claim interest on the delayed refund.

3. The Member carefully considered the submissions and records. It was noted that the refund claim was filed on 19/2/2009 and sanctioned on 30/9/2009, indicating a delay in the process. The appellant had submitted self-attested copies of TR-6 Challan along with the refund claim, which should have been sufficient for the refund since the pre-deposit was ordered by the Tribunal and accepted. The Member referred to a settled law case, Ranbaxy Laboratories Ltd. Vs. Union of India, where it was established that if a refund is delayed beyond three months from the filing date, the Revenue must grant interest for the delayed period.

4. Considering the facts of the case and the legal precedent, the Member concluded that the appellant was entitled to interest on the refund claim for the period beyond three months from the filing date until the sanction of the refund claim, as per Section 11BB of the Central Excise Act, 1944. Therefore, the appeal of the appellant was allowed, and they were granted interest on the delayed refund claim.