2020 (1) TMI 97 - AT - Central Excise

Interest on delayed refund - wrongful adjustment of refund amount against amounts allegedly due under the CGST Act - section 79(1)(a) of the CGST Act, 2017. Demand of interest on refund - HELD THAT - There is no specific finding either in the Order-in-Original or in the Order-in- Appeal as to whether the appellant is entitled to the interest on refund under section 11BB or otherwise with the reasons. Therefore, it is a fit case to be remanded to the original authority for this purpose only. Appropriation of the amount towards amounts allegedly due under CGST Act - HELD THAT - This Tribunal has no jurisdiction over any decision under the CGST Act. Transitional provisions for transfer of CENVAT credit and refund of duty, etc., from the excise or service tax to the GST have been made under the CGST Act and not under the Excise Act or Service Tax Act. Therefore, decisions pertaining to the transitional provisions are decisions under the CGST Act which the officers are fully competent to take but this Tribunal is not competent to decide appeals against - Further, this adjustment is contested by the appellant on the ground that the amount was not due under the realm of CGST Act. A decision as to whether the amounts are due or otherwise falls under the CGST Act which can also not be decided by this Tribunal. Under the CGST Act, there is a provision for GST Appellate Tribunal to hear appeals against such decisions. Without passing any remark on the appropriation of the amount towards amounts said to be under the CGST Act, the matter remanded to the original authority for limited purposes of giving specific finding on the admissibility of the interest on the amount of interest claimed by the appellant - appeal allowed by way of remand.

Summary

Issues:
1. Appropriation of refunded amount against recoverable amount under CGST Act.
2. Entitlement to interest on the refund amount under section 11BB of Central Excise Act.

Analysis:
1. The appellant filed an appeal against the Order-in-Appeal dated 13.09.2019, seeking a refund of ?2,20,444/- paid during an investigation. The Deputy Commissioner sanctioned the refund but appropriated the entire amount against recoverable amounts under section 79(1)(a) of the CGST Act. The First Appellate Authority upheld this decision. The appellant contended that no recoverable amount existed under the CGST Act for such adjustment. The Tribunal noted that the cause of action arose under the Central Excise Act, but the appropriation was made under the CGST Act. The Tribunal lacked jurisdiction over decisions under the CGST Act. The matter was remanded to the original authority to determine the admissibility of interest and appropriateness of the adjustment under the CGST Act.

2. The appellant also argued that interest on the refund amount under section 11BB of the Central Excise Act was not addressed in the orders. The Tribunal found no specific finding on the entitlement to interest. Therefore, the matter was remanded to the original authority solely to determine the entitlement to interest under section 11BB. The Tribunal clarified that decisions regarding transitional provisions under the CGST Act were not within its jurisdiction, and such matters should be addressed by the appropriate authority under the CGST Act. The appeal was allowed for remand on the specific issue of interest entitlement, without commenting on the appropriation under the CGST Act.

In conclusion, the Tribunal remanded the case to the original authority to decide on the entitlement to interest on the refund amount under section 11BB of the Central Excise Act and to determine the appropriateness of the adjustment made under the CGST Act. The Tribunal clarified its lack of jurisdiction over decisions under the CGST Act and emphasized that matters related to the CGST Act should be addressed by the competent authority under the CGST Act.