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2018 (6) TMI 184 - AT - Central ExciseRefund of interest recovered from Revenue - Non-issuance of SCN - Kar Vivad Samadhan Scheme, 1998 (KVSS) - Levy of additional duty of excise(goods of special importance) - rejection of KVSS application on the grounds that the declaration filed is not against any SCN issued prior to 31.03.1998 - entire case is based on the interpretation of the Hon ble Supreme Court order in the respondent s case M/S. SHARDA SYNTHETICS LTD. VERSUS UNION OF INDIA & ORS. 2015 (11) TMI 604 - SUPREME COURT which was passed with reference to application filed under the KVSS 1998. Held that - The Hon ble Supreme Court has very consciously held that Revenue recovered the entire amount by encashing bank guarantee on 13-10-2013 in view thereof it is not necessary to go into issue and we are of the opinion that having regard to the peculiar facts of this case and also that the appellant has some arguable case on merit interest of justice would be sub-served if no interest is demanded. The conclusion of the entire findings is that entire demand of interest was set aside. Even if overall circumstances are observed it is seen that whole case is based on the application made in KVSS 1998. As per the KVSS the 50% of duty, interest and penalty are liable to be waived as immunity provided under the scheme. The respondent is clearly eligible for the refund of interest recovered by the Revenue for ₹ 48,05,753/- - appeal dismissed - decided against Revenue.
Issues:
1. Interpretation of Hon'ble Supreme Court order regarding refund claim under KVSS 1998. 2. Discrepancy in the interpretation of the Supreme Court order between Revenue and the respondent. 3. Eligibility of the respondent for the refund of interest recovered by the Revenue. Analysis: Issue 1: The case revolves around the interpretation of the Hon'ble Supreme Court order concerning the respondent's refund claim under the Kar Vivad Samadhan Scheme, 1998 (KVSS). The respondent had applied under the scheme, but the application was rejected by the Revenue. The Supreme Court, in Civil Appeal No. 2819 of 2017, passed an order directing that no further interest be recovered from the appellant. The Court acknowledged the liability, bank guarantee encashment, and pending litigations, emphasizing the appellant's arguable case on merit. Issue 2: The Revenue contended that the Commissioner (Appeals) misinterpreted the Supreme Court order by allowing the refund claim. The Revenue argued that the Court's direction was limited to not recovering the balance amount of interest, not the interest already recovered. However, the respondent's counsel argued that the Commissioner correctly interpreted the Supreme Court judgment, concluding that the entire interest demand was set aside. The Commissioner's detailed analysis supported the respondent's eligibility for the interest refund. Issue 3: The Tribunal analyzed the Supreme Court order, emphasizing that the Court's intention was not to recover any interest due to the peculiar facts of the case and the appellant's arguable case on merit. The Tribunal concurred with the Commissioner's findings, stating that the entire demand for interest was waived, making the respondent eligible for the refund of interest recovered by the Revenue. The Tribunal upheld the Commissioner's order, dismissing the Revenue's appeal. In conclusion, the Tribunal upheld the Commissioner's decision, emphasizing the Supreme Court's direction to not recover any further interest and the respondent's eligibility for the interest refund. The detailed analysis of the Supreme Court order and the application of the KVSS 1998 scheme played a crucial role in determining the outcome of the case.
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