9911796707
TMI Blog2016 (12) TMI 377X X X X Extracts X X X X X X X X Extracts X X X X ..... ance Licence No. 1531815 dated 07.03.1996, issued vide Notification No. 149/95 Cus read with Notification No. 162/95 Cus, having port of registration as Mumbai. The appellant accordingly executed a Bond covering duty foregone and interest there for Rs. 2,62,10,552/- backed by Bank Guarantee for Rs. 65,52,638/-. Since the appellants failed to submit the proog of fulfilment of Export Obligation within the time period, the Bank Guarantee was encashed and deposited vide challan No. 7291 dated 17.12.99. The appellants filed a W.P. no. 25080 of 1999 in Hon'ble High Court at Hyderabad which directed the Jt. Director General of Foreign Trade, Hyderabad to accept the request regarding clubbing of two licences and after the same was accepted the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on 27(1) of C.A. 1962. 3. Aggrieved by such an order appellant preferred an appeal before the first appellate authority seeking the amount of interest from the department. The said appeal was dismissed by the first appellate authority. 4. Learned Chartered Accountant submits that the interest is payable on the amounts after the appellant has filed a letter for the refund of the amount from the authority on completion of the entire proceedings. He would submit that the lower authorities have improperly encashed the Bank Guarantee without waiting for the decision from the Jt. DGFT. He would submit that Jt. DGFT had sanctioned the clubbing of licences with direction to pay the composition fees for unfulfilled export obligation and differenti ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... (70) ELT 48 (S.C.)] it was held that Bank Guarantee as furnished by the appellant is not an Excise duty or equivalent to payment of Excise duty; hence there is no question of granting interest, as interest if any, can be considered only on an amount which is claimed as refund of duty. 6. On consideration of the submission made by both sides, we find that the appeal of the appellant merits acceptance for more than one reason. 6.1 Firstly, the encashment of the Bank Guarantee by the department on 17.12.1999 despite they are being an interim order of the Hon'ble High Court not to encash the Bank Guarantee; is an illegal step of the department which amounts to holding back of an amount for which department had no legal sanction and ..... X X X X Extracts X X X X X X X X Extracts X X X X
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