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2024 (3) TMI 794 - HC - Central ExciseInterest on refund received belatedly - Section 11BB of Central Excise Act, 1944 - HELD THAT - A perusal of the material on record, comprising of the details of the refund orders and refund payments made in favour of the petitioner as enumerated in Annexure-C clearly indicate that, the petitioner would be entitled for interest for delayed refund in terms of Section 11BB of the Act. The reasons assigned by the respondents in refusing grant of interest in Annexure-B dated 25.04.2022 is clearly erroneous in as much as adjudication proceedings have not been initiated against the petitioner as borne out from the material on record even till today. Under these circumstances, there is absolutely no impediment to direct the respondents to grant applicable interest on delayed refund in terms of Section 11BB of the Act in favour of the petitioner. However, in order to grant an opportunity to the concerned respondent for the limited purpose to verify the calculation of quantum of interest on the delayed refund as claimed by the petitioner, it is deemed just and appropriate to set aside Annexure-B dated 25.04.2022 and direct the concerned respondent to grant interest on the refund as sought for in Annexure-C dated 15.06.2022 in favour of the petitioner after making due verification and in accordance with law within a stipulated time frame. Petition allowed.
Issues involved:
The petitioner sought a writ of mandamus to direct the Respondent No. 2 to accept the claim for interest on a delayed refund and adjudicate the matter following due procedure according to Section 11BB of the Central Excise Act, 1944. The petitioner also requested other appropriate relief, costs of the petition, and any other fitting order or direction. Summary of Judgment: Issue 1: Claim for interest on delayed refund The petitioner submitted an application for refund of interest on delayed receipt of Service Tax refund from May 2008 to June 2017 as per Section 11BB of the Central Excise Act, 1944. The respondents erroneously stated that the question of interest would be dealt with during adjudication proceedings, leading the petitioner to file a petition seeking interest on the delayed refund. The court found that the petitioner was entitled to interest for the delayed refund as per Section 11BB of the Act. The court set aside the erroneous communication from the respondents and directed them to grant interest on the delayed refund after due verification within a stipulated time frame. In conclusion, the High Court of Karnataka allowed the writ petition, quashed the impugned communication issued by Respondent No. 2, and directed the respondents to pay interest on the delayed refund as requested by the petitioner after verification, to be completed within two months from the date of the judgment.
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