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TMI Blog2015 (9) TMI 34X X X X Extracts X X X X X X X X Extracts X X X X ..... from three months after date of application till date of its actual payment – Also respondent would be entitled to costs or compensation for high handedness of appellant, by initially not refunding amount for over 12 years, and then refusing to pay interest even after order of Tribunal – Decided against Revenue. - CSTA No. 4/2015 - - - Dated:- 13-8-2015 - Vineet Saran And B. Manohar, JJ. For the Appellant : Sri C Shashikantha, Adv. For the Respondents : Sri Ganapati Hegde Sri R G Sheth, Advs. JUDGMENT This appeal has been filed by the Revenue-Commissioner of Customs, Bangalore, against the order dated 21.05.2014 of the Customs, Excise and Service Tax Appellate Tribunal (CESTAT), whereby the appeal filed by the respondent-company, which was with regard to payment of interest under Section 27A of the Customs Act, 1962 (for short the Act ), has been allowed. 2. The facts of this appeal in brief are that on 04.06.1998 the respondent-company had imported certain items and cleared the same on payment of customs duty. Later, the respondent realized the mistake of having deposited the customs duty, as the good which were imported were exempted from customs duty ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ithin three months of the order of the Supreme Court. Being dissatisfied with the non-payment of interest under Section 27A of the Act, which, according to the appellant would be due immediately after three months from the date of application claiming refund (i.e., 24.12.1998), the respondent filed an appeal against the order dated 13.04.2011 before the Commissioner of Customs (Appeals), which was dismissed by order dated 13.01.2012 holding that the respondent-company was not eligible for interest since the refund was sanctioned within three months from the date of the judgment of the Supreme Court and also on the ground that the amount to be refunded was with the Consumer Welfare Fund for substantial period. Aggrieved by the said order, the respondent-company filed a further appeal before the Tribunal, which by a detailed reasoned order, allowed the appeal on 21.05.2014. Challenging the said order of the Tribunal, this appeal has been filed by the Revenue raising the following substantial questions of law: i. Whether in case of consequential refund arising out of order of Appellate Authority, Tribunal, High Court or Supreme Court, the time taken in the legal process till the c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... before the Supreme Court, where the appellant-Revenue had been unsuccessful. It was then, after more than 12 years of filing of the application for refund, on 13.04.2011 an order was passed by the Assistant Commissioner for refunding the amount, but without interest. 6. Here, we may mention that initially itself it took nearly three years for the Department to process the application of the respondent for refund of customs duty and pass an order on the same, which, in our opinion, does not appear to be justified, but we however refrain from passing any further comments on this issue. 7. Even after the amount was found to be payable to the respondent-company, the appellant-Revenue did not pay the interest on the amount to be refunded. Admittedly, the respondent was deprived of the amount of over ₹ 1 Crore which had been deposited by it, and was found refundable to the respondent-company. Earlier also, the appellant dragged on the matter up to the Supreme Court, and paid the amount only after more than 12 years when the matter was finalized by the Supreme Court. Now again, with regard to the interest part, even when the Tribunal had directed payment of interest from thre ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s the assent of the President, is not refunded within three months from such date, there shall be paid to the applicant interest under this section from the date immediately after three months from such date, till the date of refund of such duty. Explanation: Where any order of refund is made by the Commissioner (Appeals), Appellate Tribunal, the National Tax Tribunal or any court against an order of the Assistant Commissioner of Customs or Deputy Commissioner of Customs under sub-section (2) of section 27, the order passed by the Commissioner (Appeals), Appellate Tribunal or, as the case may be, by the court shall be deemed to be an order passed under that sub-section for the purposes of this section. 11. From plain reading of the said Section, it is clear, that interest would be payable if the amount is not refunded within three months from the date of the application. The rate of interest would vary from 5% to 30% per annum, as may be fixed by the Central Government by Notification from time to time. Explanation immediately after the proviso in the said Section only means that the liability to pay the amount would arise after the order of refund of the amount is finalized ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ghtful claim of interest, even after the order for refund of the amount had been made upto the Supreme Court. Not only that, the interest has been denied to the respondent even though the order directing payment of interest was made by the Tribunal on 21.05.2014, which was based on a decision of the Supreme Court. Merely because of the pendency of this appeal, though there was no stay order granted, the appellant has thus, without any valid reason, further delayed the payment of interest for a period of over 15 months from the date of the order of the Tribunal dated 21.05.2014. On having been questioned as to whether the appellant would stall recovery proceedings against any defaulting assessee merely if the assessee files an appeal and there is no stay order, the learned counsel for the appellant could not say that the Department would stall any such recovery in the absence of interim order passed by the competent authority or Court. If that be so, if no interim order was granted in favour of the Revenue in this appeal, it is not understood as to why the refund of interest was not paid to the assessee for these 15 months. 14. In such circumstances, we are of the opinion that th ..... X X X X Extracts X X X X X X X X Extracts X X X X
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