2015 (11) TMI 827 - AT - Central Excise

Delayed refund - payment of interest on delayed refund - department appropriated the amount towards arrears of duty due involved - Held that - Rebate was initially sanctioned and the same was appropriated towards dues arising out of Commissioner s Order. I find that the said appeal was filed against the Commissioner (Appeals) order and stay was obtained vide Tribunal s Misc. Order 2012 (6) TMI 794 - CESTAT CHENNAI and it was subsequently extended by another order. During the period when stay was not extended by the Tribunal as there was no Division Bench sitting the authority has adjusted the amount sanctioned towards recovery by holding that there was no stay which has resulted in appellant filing of writ petition before the Hon ble High Court of Madras - Madurai Bench of the Hon ble High Court of Madras set aside the said recovery in their order dated 29.10.2012 and directed the department to release the amount and in compliance with the High Court direction the said amount was released by the authority in O-in-O dated 10.12.2012. I find that since the original amount was sanctioned on 18.11.11 22.11.11 23.11.11 24.11.11 25.11.11 which was initially appropriated but subsequently released on 10.12.2012 the appellants are eligible for the refund of interest on the delayed payment. - Decided in favour of assessee.

Summary

Issues involved:
- Payment of interest on delayed refund

Detailed analysis:
The appellant filed an appeal against the Order of the Commissioner (Appeals) related to the payment of interest on delayed refund. The appellant had requested the release of a rebate amount of Rs. 29,42,034/-, which was sanctioned but without interest on delayed payment. The Commissioner (Appeals) upheld the decision to reject the interest claim, leading to the present appeal.

The appellant argued that they were eligible for interest as per the Hon'ble High Court's order directing the department to pay the rebate amount. They highlighted that interest had been paid in similar cases by the department previously, referencing Tribunal's Final Orders in the appellant's own case. The department contended that the rebate was sanctioned and appropriated towards dues promptly, as there was no stay against the order.

Upon review, the Tribunal found that the rebate was initially sanctioned but later released after a delay due to the appellant's writ petition before the Hon'ble High Court. The Tribunal noted that the appellant had obtained a stay from the Tribunal, and the department's action of appropriating the amount without an extended stay led to the writ petition. Citing previous decisions and the Hon'ble Apex Court's ruling, the Tribunal concluded that the appellant was entitled to interest on the delayed payment. The Tribunal set aside the impugned order and allowed the appeal with consequential relief.

In conclusion, the Tribunal ruled in favor of the appellant, emphasizing their entitlement to interest on the delayed refund based on legal precedents and the circumstances of the case.