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TMI Blog2019 (12) TMI 715X X X X Extracts X X X X X X X X Extracts X X X X ..... 6 which is admitted in the SCN itself. The appellant is entitled to interest after expiry of three months from 25.07.2006 till 21.12.2018 when the refund was sanctioned - Appeal disposed off. - MR. S.S GARG, JUDICIAL MEMBER Shri Doiphode, Advocate for the Appellant Shri Gopa Kumar, Joint Commissioner, Authorized Representative for the Respondent ORDER The present appeal is directed against the impugned order dated 01.05.2019 passed by the Commissioner (Appeals) whereby the Commissioner (A) has held that the appellant is eligible for interest but he has not specifically written from which date the interest is admissible. The appellant is seeking interest from the date of deposit of duty whereas the Revenue is of the view that the appellant is entitled to interest after the expiry of three months from the date of application i.e. from 24.05.2018 when the appellant moved application for refund after the decision of the Tribunal. 2. Briefly the facts of the present case are that the appellant is a manufacturer of hot re-rolled products of steel and were brought under the annual capacity of production scheme under Section 3A of the Central Excise Act w.e.f. 25.07.1997. The Commissione ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rom which date the interest is to be calculated. 3. Heard both the parties and perused the records. 4. Learned Counsel for the appellants submitted that the impugned order is vague and not clear as to from which date the interest is to be paid to the appellant. He further submitted that Commissioner (A) in Para 15 has allowed the appeal holding that the appellants are entitled for interest but he has not specifically written from which date the interest is admissible. However, in Para 12 of the impugned order, the Commissioner (A) by following the number of judgments has observed that refund is required to be paid after three months from the original refund/rebate application and interest is payable from the date immediately after the expiry of three months. Further, in Para 14 also, the Commissioner (A) has made the similar observation. Learned counsel further submitted that the appellants are entitled to interest from the date of deposit of duty and not from the expiry of three months from the date of application. For this submission, he relied upon the judgment in the case of Toyota Kirloskar Auto Parts Pvt. Ltd. Vs CC, Bangalore reported in 2009 (240) ELT 124 (Tri. Bang.). The ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eferred to supplementary instructions of CBEC Central Excise Manual which also provides that if the refund claim is sanctioned beyond three months, the Department has to pay interest as applicable from the expiry of three months after the submission of claim, till refund is sanctioned. Further, I find that Commissioner (A) has relied upon the various decisions of the Hon ble High Court, Hon ble Supreme Court and Revisional Authorities and has come to the conclusion that the appellants are entitled to interest after the expiry of three months from the date of refund application. Further, I find that in the present case, the first refund application was filed on 25.07.2006 seeking refund of ₹ 31,38,685/- and this fact is recorded in Para 2 of the SCN and this fact has also been recorded in the original order passed by the Asst. Commissioner dated 17.06.2011. Further, I find that during the personal hearing before the Commissioner (A), the appellant brought to the notice of the Commissioner (A) that they filed the refund claim on 25.07.2006 as admitted in Para 2 of the SCN dated 23.10.2006 and the decision of the Tribunal F.O. No. 22700/2017 dated 06.11.2017. Further, I find tha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lays down that in case any duty paid is found refundable and if the duty is not refunded within a period of three months from the date of receipt of the application to be submitted under sub-section (1) of Section 11B of the Act, then the applicant shall be paid interest at such rate, as may be fixed by the Central Government, on expiry of a period of three months from the date of receipt of the application. The Explanation appearing below Proviso to Section 11BB introduces a deeming fiction that where the order for refund of duty is not made by the Assistant Commissioner of Central Excise or Deputy Commissioner of Central Excise but by an Appellate Authority or the Court, then for the purpose of this Section the order made by such higher Appellate Authority or by the Court shall be deemed to be an order made under sub-section (2) of Section 11B of the Act. It is clear that the Explanation has nothing to do with the postponement of the date from which interest becomes payable under Section 11BB of the Act. Manifestly, interest under Section 11BB of the Act becomes payable, if on an expiry of a period of three months from the date of receipt of the application for refund, the amoun ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on such representations, it has been observed that in majority of the cases, no reason is cited. Wherever reasons are given, these are found to be very vague and unconvincing. In one case of consequential refund, the jurisdictional Central Excise officers had taken the view that since the Tribunal had in its order not directed for payment of interest, no interest needs to be paid. 2. In this connection. Board would like to stress that the provisions of section 11BB of Central Excise Act, 1944 are attracted automatically for any refund sanctioned beyond a period of three months. The jurisdictional Central Excise Officers are not required to wait for instructions from any superior officers or to look for instructions in the orders of higher appellate authority for grant of interest. Simultaneously, Board would like to draw attention to Circular No. 398/31/98-CX., dated 2-6-98 [1998 (100) E.L.T. T16] wherein Board has directed that responsibility should be fixed for not disposing of the refund/rebate claims within three months from the date of receipt of application. Accordingly, jurisdictional Commissioners may devise a suitable monitoring mechanism to ensure timely disposal of refun ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Industries (supra), relied upon by the Delhi High Court. It is evident from a bare reading of the decision that insofar as the reckoning of the period for the purpose of payment of interest under Section 11BB of the Act is concerned, emphasis has been laid on the date of receipt of application for refund. In that case, having noted that application by the assessee requesting for refund, was filed before the Assistant Commissioner on 12th January 2004, the Court directed payment of Statutory interest under the said Section from 12th April 2004 i.e. after the expiry of a period of three months from the date of receipt of the application. Thus, the said decision is of no avail to the revenue. 15. In view of the above analysis, our answer to the question formulated in para (1) supra is that the liability of the revenue to pay interest under Section 11BB of the Act commences from the date of expiry of three months from the date of receipt of application for refund under Section 11B(1) of the Act and not on the expiry of the said period from the date on which order of refund is made. 14. Recently the Tribunal Bangalore in the case of Microsoft Global Services Center (India) Pvt. Ltd. vs ..... X X X X Extracts X X X X X X X X Extracts X X X X
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