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TMI Blog2020 (4) TMI 178X X X X Extracts X X X X X X X X Extracts X X X X ..... reading of the provision of Section 35FF, it is clear that the appellant was required to deposit entire amount of duty, interest and penalty while pursuing their appeal before the first appellate authority or CESTAT. Section 35FF prescribes that the amount deposited before the appellate authority, if not refunded within three months from the date of communication of the order to the adjudicating authority, the appellant shall be paid interest at the rate specified under Section 11BB after expiry of three months from the date of communication of the order till the date of refund of such amount. Thus, the reference under Section 35FF of Central Excise Act, 1944 to Section 11BB is only for the limited purpose of applicability of rate of inter ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... dit availed on such inputs. Alleging that the appellants are required to discharge duty on the transaction value of the goods, demand notice was issued for recovery of duty of ₹ 13,09,644/- short paid with interest and penalty. On adjudication, the demand was confirmed with interest and penalty. Consequently, the appellant filed an appeal before the learned Commissioner (Appeals), thereafter approached this Tribunal for relief. During the course of filing of appeal before the learned Commissioner (Appeals) as well as before this Tribunal, they have deposited the entire amount of differential duty, interest and penalty totaling ₹ 33,32,327/-. Finally, this Tribunal vide order dated 21.10.2016 decided the issue in favour of the ap ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ection 35F of the Central Excise Act, 1944. Hence, the observation of the learned Commissioner (Appeals) that interest on interest and interest on penalty is not admissible, cannot be sustained in the present case. In support, he referred to the judgment of this Tribunal in the case of Maithan Ceramics Ltd. Vs. CENVAT Credit Rules, 2004, Visakhapatnam 2019 (367) ELT 670 (Tri-Hyd), and judgment of Hon'ble High Court of Delhi in the case of Xerox India Ltd. Vs. Assistant Commissioner, Ward-114 (Special Zone), Department of Trade Taxes, Government of NCT 2019 (20) GSTL 348 (Del). 4. Per contra, the learned AR for the Revenue has submitted that as per Section 11B read with Section 11BB of Central Excise Act, 1944, it is clea ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... interest only on refund of duty. 7. It is not in dispute that the appellant had deposited the duty for ₹ 33,32,327/- i.e. the entire amount of duty, interest and penalty confirmed against the appellant by the original adjudicating authority. The appellant chose to deposit ₹ 5.00 lakhs initially before the Commissioner (Appeals) and later before the CESTAT, the remaining amount in compliance with Section 35F of the Central Excise Act, 1944. Before analyzing the issue, it is necessary to reproduce the provisions of Section 35FF of the Central Excise Act, 1944 as was in force during the relevant time, which reads as under: - 35FF. Interest on delayed refund of amount deposited under the proviso to section 35F. - Where an ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of rate of interest in computing the refund amount. The amount deposited with the appellate authorities pursuant to Section 35F of Central Excise Act, 1944 cannot be considered as duty, interest or penalty but as an amount necessary to pursue the appeal before the appellate forum. Consequently, if the decision of the appellate forum is in favour of the appellant, the appellants are entitled to refund of the amount deposited for pursuing the appeal before the appellate authorities within the period prescribed under Section 35FF of Central Excise Act, 1944. In this scenario, the appellants are entitled to interest on the pre-deposit amount as per Section 35FF of the Central Excise Act, 1944. The same view has also been expressed by this Tri ..... X X X X Extracts X X X X X X X X Extracts X X X X
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