2022 (6) TMI 708 - HC - Central Excise

Interest on delayed refund - Extended Period of limitation - refund having been made beyond the period of three months from the date of filing of application for refund - Section 6 of the Taxation and Other Laws (Relaxation and Amendment of Certain Provisions) Act, 2020 and section 11BB of the Central Excise Act, 1944 - HELD THAT - From bare perusal of Section 6 of the 2020 Act, it is evident that the time limit as and where prescribed in the provisions of Central Excise Act, 1944 is deemed to be extended without any exception. Thus, the time limit prescribed in Section 11BB of the Central Excise Act is deemed to be extended by Section 6 of the 2020 Act. As such, in view of the overriding effect of Section 6 of the 2020 Act, the time limit of three months prescribed for grant of refund u/s 11BB also stands extended till 30 th September, 2020. The order of refund was passed within the extended time limit and, therefore, is saved by Section 6 of the 2020 Act from being subjected to the rigors of Section 11BB of Central Excise Act - It is well settled that Tax Laws are to be interpreted strictly in terms of the terminology employed by legislature. Nothing can be inferred nor implied. Tax statute is to be plainly read without bringing the element of equity into play. Thus, the refund was sanctioned within extended time period prescribed under the 2020 Act and, therefore, the claim for interest in that regard is untenable and thus is hereby rejected - petition dismissed.

Summary

Issues:
1. Interpretation of Section 6 of the Taxation and Other Laws (Relaxation and Amendment of Certain Provisions) Act, 2020 in relation to Section 11BB of the Central Excise Act, 1944.
2. Validity of interest claim on delayed refund under Section 11BB.
3. Extension of time limit for refund under the 2020 Act.
4. Application of legal principles in tax laws interpretation.

Analysis:
1. The primary issue in this case revolves around the interpretation of Section 6 of the 2020 Act concerning the time limit for refund under Section 11BB of the Central Excise Act. The court deliberated on whether the time limit prescribed in Section 11BB was extended by the provisions of the 2020 Act, which extended all prescribed periods related to duties and remedies under the Excise Act until 30th September, 2020.

2. The controversy centered on the claim for interest on delayed refund under Section 11BB. The petitioner sought interest as the refund was made after three months from the date of filing the refund application. However, the respondents argued that the order of refund was validated by the extension of time limits specified in the 2020 Act, thereby contesting the petitioner's claim for interest under Section 11BB.

3. The court analyzed Section 6 of the 2020 Act, which explicitly extended the time limit specified in the Central Excise Act without exceptions. Consequently, the time limit for granting a refund under Section 11BB was deemed extended until 30th September, 2020. As the order of refund in this case was issued within the extended time limit, it was deemed saved from the provisions of Section 11BB, as per the overriding effect of the 2020 Act.

4. In the interpretation of tax laws, the court emphasized strict adherence to the legislative terminology without introducing elements of equity. The judgment highlighted that the refund was sanctioned within the extended time period prescribed by the 2020 Act, leading to the rejection of the petitioner's claim for interest. Additionally, the court granted the petitioner liberty to pursue an appeal for another interest claim period from 9th October, 2015, to 8th October, 2020, as per Annexure P/3.

5. Ultimately, the court rejected the petitioner's claim for interest on the delayed refund, dismissing the petition while allowing the petitioner the opportunity to appeal for the additional interest claim period. The judgment underscored the importance of legal precision in interpreting tax laws and upheld the application of statutory provisions in determining the validity of claims related to refunds and interest under the Central Excise Act.