2016 (11) TMI 268 - AT - Central Excise

Refund claim - excess duty paid on Target Achievement discount, Cash discount, Turnover tax, Freight, Octroi, during the period from July, 1985 to September, 1996 in respect of Electric Fans falling under sub-heading no. 8414.80 of the First Schedule to the Central Excise Tariff Act, 1985 - refund claim for refund of pre-deposit amount of ₹ 23 Lakh - Whether the amount of ₹ 23 Lakhs is included in the amount of ₹ 54,30,017/- or not and (ii) If it is not included, the assessee is eligible for refund as the refund claim is within the time limit? - provisional assessment covered by Rule 9B of the erstwhile Central Excise Rules, 1944 - Held that - In appeal No. E/541/2007, the lower appellate authority has set aside order of original authority and has held that appellant are eligible for refund of ₹ 54,30,017.82/- with interest. In appeal E/817/2009 in the second ground of litigation, lower appellate authority has once again held that appellants are eligible for said amount of interest. It is seen that in both orders the appellate authorities have analysed the matter in great detail and only there after arrived at the conclusion of sanction of refund and interest. We do not find any infirmities in these impugned orders. Hence no merit found in these appeals. Interest on delayed refund - Department has argued that since the period involved in the refund claim is July 1985 to September 1996, the interest liability will not arise in their case since provisions of 11BB have come into force w.e.f 26.05.1995 - Held that - the provisional assessment itself was finalized only on 27.08.1998 and the refund claim filed on 23.02.1999. The order of refund was vide Order in Original dated 10.08.2007. This being so there is no merit in the departments contention against grant of interest on delayed refund as ordered by lower appellate authority in OIA dated 10.11.2009. Appeal dismissed - decided against Revenue.

Summary

Issues:
1. Refund claim for excess duty paid on various items.
2. Appropriation and rejection of refund claims by the original adjudicating authority.
3. Appeal to Commissioner (Appeals) and subsequent remand.
4. Appeal to CESTAT against the Commissioner (Appeals) decision.
5. Sanctioning of refund and rejection of interest on delayed refund.
6. Appeal regarding interest on pre-deposit amount.
7. Appeal against rejection of interest on pre-deposit.

Refund Claim and Appropriation:
The case involved a refund claim by a company for excess duty paid on various items, including electric fans. The original adjudicating authority partially sanctioned the refund claim but also appropriated a portion of the pre-deposit amount. The company filed an appeal before the Commissioner (Appeals) challenging the appropriation.

Remand and Further Adjudication:
The Commissioner (Appeals) remanded the case back to the adjudicating authority to determine if a specific amount was included in the refund claim or not. Subsequently, the original adjudicating authority held that the amount was already included in the refund claim, leading to another appeal by the company.

Appeal to CESTAT and Subsequent Orders:
The Commissioner (Appeals) allowed the company's appeal, directing the refund of the claimed amount along with interest. The department appealed this decision before CESTAT, arguing that the company was not entitled to the refund due to a previously sanctioned amount to be credited to the Consumer Welfare Fund.

Interest on Delayed Refund:
The original authority sanctioned a refund but rejected the interest on the delayed refund. Subsequent appeals and orders resulted in conflicting decisions regarding the eligibility of the company for interest on the refunded amount.

Final Decision by CESTAT:
After detailed analysis, CESTAT dismissed all appeals by the department. CESTAT found no merit in the department's argument that interest liability did not arise due to the timeline of the refund claim and provisional assessment finalization. The lower appellate authorities' decisions to grant the refund and interest were upheld by CESTAT, concluding the legal proceedings.