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TMI Blog2013 (7) TMI 721X X X X Extracts X X X X X X X X Extracts X X X X ..... by a superior court and that the Board had decided to implement CESTAT orders already passed for payment of interest in compliance of which interest payable would be paid forthwith - In CCE, Hyderabad Vs. I.T.C. Limited (2004 (12) TMI 90 - SUPREME COURT OF INDIA ) - Section 27-A applies to a claim of refund of duty or interest and does not specifically refer to the payment of interest on a refund of penalty or on pre-deposit effected before the Appellate Tribunal or before the appellate authority – appeal decided in favour of assessee. - Writ Petition No. 1523 of 2013 - - - Dated:- 19-6-2013 - Dr. D. Y. Chandrachud And A. A. Sayed, JJ. For the Petitioner : Mr. Prashant Mishra i/by Yogesh M. Rohire For the Respondent : Mr. P ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... order was passed on 25 February 2008, as noted above, imposing penalties of Rs.7.50 crores and Rs.50.00 lakhs respectively. The CESTAT by its judgment dated 29 May 2012 set aside the penalties imposed on the Petitioners. Before this Court it is not in dispute that the order of the CESTAT was accepted by the Revenue and no further challenge was made. 4. These proceedings under Article 226 of the Constitution were instituted on 11 January 2013 for enforcement of the order of the Tribunal and for grant of a consequential refund with interest from 20 December 1990 when the amounts of Rs.20.00 lakhs and Rs.5.00 lakhs respectively were paid. During the pendency of the proceedings, two orders of refund have been passed on 13 March 2013 by the Co ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Metropolitan Magistrate, 16th Court, Mumbai. 6. Thereafter, a personal hearing was fixed on 29 January 2013 and since the Petitioners did not remain present, a deficiency memo was issued on 5 February 2013 directing the Petitioners to submit their original passports. A further personal hearing was held on 13 March 2013 at which the Petitioners reiterated the submission in regard to the passport being lodged with the investigating agency. Eventually the personal hearing was treated as a reply to the deficiency memo and a refund has been ordered of Rs.20.00 lakhs and Rs.5.00 lakhs to the First and Second Petitioners by orders dated 13 March 2013. 7. Since a refund has been ordered and has now been granted to the Petitioners, that part of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of payment of interest on delayed refunds could not be maintained. The Supreme Court held that till the insertion of Section 27-A by Act XXII of 1995, there was no right entitling the payment of interest on delayed refunds under the Customs Act, 1962 and such a right was conferred for the first time by the insertion of that provision. The Supreme Court, however, held that cases where a direction for the payment of interest was by way of consequential relief along with the main relief of setting aside the impugned order of tax or duty, stood on a different footing. 9. Strictly speaking, Section 27-A applies to a claim of refund of duty or interest and does not specifically refer to the payment of interest on a refund of penalty or on pre- ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... issue as regards payment of interest on predeposits which became refundable to assessees upon the final orders of the Tribunal was revisited by a Bench of three learned Judges of the Supreme Court in Commissioner of Central Excise, Hyderabad Vs. I.T.C. Ltd. (supra). During the pendency of the proceedings, a draft circular was issued by the CBEC accepting that a refund would have to be made of predeposits which became refundable following the final order of the Tribunal or Court within a period of three months of the date of the order. The CBEC accepted that the liability to pay interest beyond a period of three months would stand attracted. The subject of the circular relates both to the return of deposits made in terms of Section 75 of th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ber 2012 the Petitioners forwarded a copy of the CESTAT order, in original, as well as receipts evidencing payment of pre-deposit. The Petitioners explained that they were unable to produce the original of the order of adjudication since it had been filed with the Tribunal when the appeal was preferred, and the passport had been taken over during the course of investigation of the criminal complaint. The Commissioner of Customs was in any event provided with all necessary documentation namely - (i) the order of the Tribunal under which the refunds became payable; and (ii) the original receipts showing a pre-deposit of the duty of Rs.25.00 lakhs (comprising of Rs.20.00 lakhs in one case and Rs.5.00 lakhs in the other). Thereafter, there was ..... X X X X Extracts X X X X X X X X Extracts X X X X
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