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2022 (3) TMI 693 - HC - Central ExciseEntitlement for interest of refund from the date of deposit - Post GST regime - grant of interest as per the amended provisions of Section 35FF of the Central Excise Act, 1944 - HELD THAT - Claim for refund in the present case was filed on 6th January, 2016 which was returned and again filed on 19th April, 2017. Section 142 of the Act deals with miscellaneous transitional provisions including the claim for refund filed by any person before, on or after the appointed day for refund of any amount of CENVAT credit, duty, tax, interest or any other amount paid under the existing law. Section 142 of the Act when read with Section 2(48) of the Act is a complete answer to the plea raised by the appellant qua the issue of jurisdiction. The provision explicitely provides that every claim of refund shall be dealt under the existing law i.e. Central Excise Act, 1944 and not by the provisions of the Act. Thus the plea of transfer of jurisdiction due to GST regime is not available to the appellant - It is not disputed that the provisions of Income Tax Act, 1961 and Central Excise Act, 1944 are pari materia and, therefore, law laid down by the Supreme Court in the case of Sandvik Asia Ltd. 2006 (1) TMI 55 - SUPREME COURT shall be applicable to the present case. The applicability thereof to the facts of the present case - the instant appeal is hereby dismissed.
Issues:
1. Entitlement of interest for refund from the date of deposit. 2. Dismissal of rectification of mistake application by appellant. 3. Change in jurisdiction post introduction of new CGST regime. 4. Granting of interest under amended provisions of Section 35FF of the Central Excise Act, 1944. Issue 1: Entitlement of interest for refund from the date of deposit: The respondent applied for central excise duty and interest refund, which was partially allowed by the Deputy Commissioner, Central Excise, Division Panipat. The Commissioner of Central Excise (Appeals) and CESTAT also ruled in favor of the respondent's entitlement to interest on delayed refund. The Revenue filed appeals against these orders. The Counsel for the Revenue raised questions regarding jurisdiction changes post the new CGST regime. However, the Court held that the claim for refund was filed before the new Act came into force, and thus, the jurisdiction change due to the GST regime did not affect the appellant's plea. Issue 2: Dismissal of rectification of mistake application by appellant: The appellant filed a rectification of mistake application before CESTAT, which was subsequently dismissed. The Revenue appealed against this decision. The Court found no merit in the arguments raised by the Counsel for the appellant and dismissed the appeal, upholding the decision of the Tribunal. Issue 3: Change in jurisdiction post introduction of new CGST regime: The Counsel for the Revenue argued that the respondent impleaded wrong authorities for the claim of refund and interest due to the change in jurisdiction post the introduction of the new CGST regime. The Court, however, held that the provisions of the existing law, i.e., the Central Excise Act, 1944, governed the claim for refund, and the transfer of jurisdiction due to the GST regime was not applicable to the appellant's case. Issue 4: Granting of interest under amended provisions of Section 35FF of the Central Excise Act, 1944: The Counsel argued that the Tribunal erred in granting interest as per the amended provisions of Section 35FF of the Central Excise Act, 1944. The Court referred to the law laid down by the Supreme Court in Sandvik Asia Ltd vs. CIT, Pune, and held that the appellant was entitled to interest on delayed refund. The Court ordered the Income-tax Department to pay simple interest at the rate of 9% per annum from the date it became payable till the date of actual payment, emphasizing the need for compensation for the delay in refund. In conclusion, the Court dismissed the appeal, finding no merit in the arguments presented by the appellant. The judgment emphasized the entitlement of the respondent to interest on delayed refund and the applicability of the law laid down by the Supreme Court in similar cases.
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