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TMI Blog2019 (11) TMI 1197X X X X Extracts X X X X X X X X Extracts X X X X ..... refund from the date of deposit till its realization - the appellants are entitled to claim interest from the date of payment of initial amount till the date its refund @ 12% per annum - appeal allowed - decided in favor of appellant. - Appeal No.E/60966/2019-Ex (SM), E/60965/2019-Ex (SM) - Final Order No.61041-61042/2019 - Dated:- 26-11-2019 - Hon ble Mr. Ashok Jindal, Member (Judicial) Present for the Appellant: Shri Naveen Mullick, Advocate Present for the Respondent: ShriG.M.Sharma, AR Ashok Jindal, The appellants are in appeal against the impugned orders wherein the interest on delayed refund i.e. from the date of deposit till payment thereof has been rejected by the authorities below. 2. As the issue involved in both the appeals is the same, therefore, both the appeals are decided by this common order. 3. The facts of the case are in appeal No.E/60966/2019 are that a show cause notice was issued on 30.11.2012 for demand of ₹ 62,07,630/- for the period March, 2010 to October, 2011. The Commissioner confirmed the demand of ₹ 15,74,161/- along with interest and equivalent penalty was also imposed ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ecision of the Hon‟ble Apex Court is in the context of Income-Tax Act but the provisions for entertaining the interest are identical to the provisions of Central Excise and in terms of Article 141 of the Constitution of India, the judgement given by the Hon‟ble Supreme Court is the law of land and is binding on all lower authorities. Therefore, in the light of the decision of the Hon‟ble Apex Court in the case of Sandvik Asia Limited (supra), the appellant is entitled to claim compensation by way of interest from the date of deposit of the amount till its realization. 7. He also relied on the decision of Hon‟ble Allahabad High Court in the case of Hello Mineral Water (P) Limited vs. Union of India-2004 (174) ELT 422 (All) and Hindustan Coca-Cola Beverages Pvt.Ltd. vs. Union of Inida-2015 (324) ELT 299 (Guj.). He also relied on the decision of Hon‟ble Madras High Court in the case of M/s. Areva T D India Limited vs. CC, Chennai-2013 (290) ELT 496 (Mad.). Therefore, he prayed that the interest for the intervening period be granted to the appellant. 8. On the other hand, Ld.AR opposed the contention of the Ld.Counsel for the appellan ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... (v) Xerox India Ltd vs. AsstCommr, Deptt of Trade Taxes, Govt of NCT.- 2019* (20) GSTL 348 (Del) (vi) Ratnamai Metals Tubes Ltd. vs. CCE ST Ahmedabad-III 2019 (366) ELT 139 (Tri. Ahmd.) (vii) CCE Kutch (Gandhidham) vs. Deep Construction co. 2019 (365) ELT 532 (Tri. Ahmd.) 10. Heard the parties and considered the submissions. 11. The contention of the Ld.AR is that in terms of Section 35FF of the Central Excise Act, 1944, the interest on delayed refund is to be paid after 3 months from the date of communication of the order. When specific statute has been made, therefore, the decision in the case of Sandvik Asia Limited (supra) is not applicable to the facts of this case on the ground that the said decision has been delivered by the Hon‟ble Apex Court in the context of Income Tax Act whereas we are dealing with Central Excise Act provisions. I find that whether the provisions of Income Tax Act and the provisions of Central Excise Act are pari material or not. The same has been examined by this Tribunal in the case of Donar Foods reported in 2017 (346) ELT 612(Tri.-Chan.) wherein this Tribunal observed as under:- ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... a simple operation so as to make it more saleable or more usable. The rice and the husk though separated remain as they were produced and hence continued to be agricultural product‟ or product of agriculture‟. 30. As the Hon‟ble Apex Court has held that conversion of paddy into rice is not a distinct operation and the rice and husk remain in their natural form as a result of dehusking and are covered by the term 'agricultural product‟. 31. Therefore, we hold that the test of manufacture has been failed as the goods are not manufactured goods as per Section 2(f) of Central Excise Act, accordingly, the question of excisability does not arise. Therefore, the Issue No. 1 is answered in favour of the appellants. The said decision of this Tribunal has been affirmed by the Hon‟ble Apex reported 2017 (354) ELT A-57(SC) wherein It was also held that the definition of manufacture‟ under Section 2(f) of the Central Excise Act, 1944 is pari materia to the definition provided under Section 2(29BA) of the Income-tax Act, 1961. Therefore, I find no force in the arguments advanced by the Ld.AR that the decision ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... issioner (Appeals) or the Appellate Tribunal (hereinafter referred to as the appellate authority) under the first proviso to section 35F, is required to be refunded consequent upon the order of the appellate authority and such amount is not refunded within three months from the date of communication of such order to the adjudicating authority, unless the operation of the order of the appellate authority is stayed by a superior court or tribunal, there shall be paid to the appellant interest at the rate specified in section 11BB after the expiry of three months from the date of communication of the order of the appellate authority, till the date of refund of such amount. 17. On-going through the provisions of both Income Tax Act, 1961 and Central Excise Act, 1944, the interest on delayed refund is payable after expiry of 3 months from the date of granting refund or from the date of communication of order of the appellate authority, which are pari-materia.Therefore, the decision of Hon‟ble Apex Court in the case of Sandvik Asia Ltd. (supra) is law of land, in terms of Article 14 of the Constitution of India which is to be followed by me, wherein the Hon‟ble Ap ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ice and the rule of law. COMPENSATION: 46. The word Compensation has been defined in P. RamanathaAiyar s Advanced Law Lexicon 3rd Edition 2005 page 918 as follows: An act which a Court orders to be done, or money which a Court orders to be paid, by a person whose acts or omissions have caused loss or injury to another in order that thereby the person damnified may receive equal value for his loss, or be made whole in respect of his injury; the consideration or price of a privilege purchased; some thing given or obtained as an equivalent; the rendering of an equivalent in value or amount; an equivalent given for property taken or for an injury done to another; the giving back an equivalent in either money which is but the measure of value, or in actual value otherwise conferred; a recompense in value; a recompense given for a thing received recompense for the whole injury suffered; remuneration or satisfaction for injury or damage of every description; remuneration for loss of time, necessary expenditures, and for permanent disability if such be the result; remuneration for the injury directly and proximately caused by a breach of contract or duty ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... is entitled to claim interest from the date of payment of initial amount till the date its refund. Therefore, I hold that the appellants are entitled to claim the interest on delayed refund from the date of deposit till its realization. 19. Further, the interest on the refund shall be payable @ 12% per annum as held by Hon‟ble Kerala High Court in the case of Sony Pictures Networks India Pvt.Ltd.-2017 (353) ELT 179 (Ker.) wherein it has held as under:- 14. Now, the sole question remains to be considered is what is the nature of interest that the petitioner is entitled to get. As discussed above in the judgment Commissioner of Central Excise v. ITC (supra), the Apex Court confined the interest to 12% and further held that any judgment/decision of any High Court taking contrary view, will be no longer good law. The said judgment is rendered, in my considered opinion under similar circumstances. So also in Kuil Fire Works Industries v. Collector of Central of Excise [1997 (95) E.L.T. 3 (S.C.), the pre-deposit made by the assessee was directed to be returned to him with 12% interest. I have also come across the judgment of the Calcutta High Court in Madura C ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and decided on merits. In these circumstances, the amount deposited by the appellant is to be treated as pre-deposit since the matter had not attained finality during the relevant period. Therefore, refund is to be treated as refund of pre-deposit made when the appeal was pending. There is no dispute that the amounts deposited is duty but this is not the issue which has been taken into account while precedent decisions have allowed the interest at 12% on the refunds claimed in respect of pre deposit. I find that in the decisions cited by the learned advocate, interest at 12% has been allowed. Therefore, following the judicial discipline, I consider it appropriate that interest in this case also is to be allowed @ 12%. Accordingly, original adjudicating authority is directed to workout the differential interest amount and make the payment to the appellants. 21. As the provisions of section 243 Income Tax Act, 1961 and section 35FF of Central Excise Act, 1944, are pari-materia. Therefore, following the decision of Hon‟ble Apex Court in the case of Sandvik Asia Ltd. (supra) and Sony Pictures Networks India Pvt.Ltd. (supra) I hold that the appellants are entitled to c ..... X X X X Extracts X X X X X X X X Extracts X X X X
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