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TMI Blog2020 (11) TMI 192X X X X Extracts X X X X X X X X Extracts X X X X ..... terest on the refund of duty to the appellant. In respect of claim of interest of duty to the appellant, Section 11BB applies - there are no merits in the argument of the learned Authorised Representative that the appellants were required to claim interest along with refund of duty. Section 11BB prescribes that interest is to be granted suo-moto along with refund. Appeal allowed - decided in favor of appellant. - EXCISE Appeal No. 12977 of 2019 - FINAL ORDER NO. A/11288/2020 - Dated:- 5-11-2020 - MR. RAJU, MEMBER (TECHNICAL) Shri J.C. Patel Shri Rahul Gajera, Advocates for the Appellant Shri H.K. Jain, Assistant Commissioner (AR) for the Respondent ORDER This appeal has been filed by M/s. Ganesh Enterprises against denial of interest on refund claim. 2. The facts of the case are that appellants is a manufacturer of Cellulose powder and were availing exemption under SSI Notification. The Central Excise officer visited the unit in August, 2007 and seized records of the appellant M/s. Ganesh Enterprises and M/s. Dhariyal Chemicals and Shri Yogesh C. Dhariyal, paid ₹ 15 Lakhs on the spot. The case against the appellants apparently is that M/s. Dh ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ly to refunds arising as a result of deposited under Section 35F and not to refund and interest claimed under Section 11B of Central Excise Act, 1944. While observing the Commissioner (Appeals) has pointed out that ₹ 5 Lakh was paid by the appellant against the stay order issued by the appellate authority during the month of September 2009 as pre-deposit under Section 35F and ₹ 50,000/- paid by the appellant under protest against the order-in-original against redemption fine during the month of the August 2011. Learned Counsel pointed out that there is no claim of interest in respect of Rs. Five lakh deposited as pre-deposit and ₹ 50,000/- deposited as redemption fine. He argued that they are claiming interest from the date of original application only in respect of ₹ 15 Lakh which was recovered from them by cheques taken away by department in the month of September 2007. In view of this, learned Counsel pointed out that the provisions of Section 35FF are not applicable to the refund of ₹ 15 Lakhs which was erroneously taken in September 2007 and for refund of which they have filed application on 24.12.2007 itself. 4. Learned Counsel relied on the d ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... se was issued prior to order of Tribunal directing refund. He further relied on Section 11B (5)(b)(ec)to assert that the interest is to be calculated from three months from the date of final order of Tribunal allowing refund claim. He pointed out that the refund has been issued within three months from the date of order of Tribunal therefore, there is no question of interest. He relied on the Tribunal decision in the case of Ashima Limited vs. CCE ST, Ahmedabad 2019 (369) ELT 967 (Tri. Ahmd.) wherein he claimed that under similar circumstances the claim of refund was restricted to the period from three months of final confirmation of demand by Hon ble Apex Court for part amount and refund was granted from the date of original application. 7. Learned Counsel in rejoinder stated that the decision in the case of Ashima Limited (supra) was on the different facts and circumstances. He pointed out that in that case no refund claim was filed while in their case, they have filed refund claim. He pointed out that there has been one continuous litigation which reached the Hon ble High Court in first round of litigation and Tribunal in the second round against the same claim and this i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 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.] It is clear from the above that Section 35FF is only for recoveries made under Section 35F. In these circumstances, I have no doubt in holding that order of Commissioner (Appeals) is incorrect and based on wrong premise. 9. Learned Authorised Representative argued that no application for refund of interest is made under Section 11B on 24.12.2007. He argued that Section 11B is relevant to claim the interest. It is seen that Section 11B reads as under:- Section 11B . Claim for refund of duty and interest, if any, paid on such duty (1) Any person claiming refund of any duty of excise and interest, if any, paid on such duty may make an application for refund of such duty and interest, if any, paid on usch duty to the Assistant Commissioner of Central Excise or Deputy Commissioner of Central Excise .. .. . I find that the appreciation of learned Authorised Representative regarding Section 11B is improper and incorrect. The reference t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... filed by the applicant was admittedly filed on 14-7-1999 only, thereafter, the cause of action for refund arises. Since an amount i.e. 60 Lacs minus adjudged due as per order in original, dated 21-4-1999 become refundable and the same should have been sanctioned within 3 months from date of filing of application i.e. 14-7-1999. Accordingly, on such balance amount the interest is payable from 3 months of date of filing the refund i.e. 14-7-1999. As regard remaining amount of refund that has arisen only from the date of Tribunal order dated 12-6-2002 by which the demand confirmed by the original order was set aside, that means the amount of duty which was set aside by the Tribunal become refundable from 3 months of Tribunal order dated 12-6-2002. Accordingly, on such amount interest is payable from 3 months of date of Tribunal order. As regard the submission of Ld. Counsel that it is a deposit made during investigation which was otherwise not required, the interest is payable from the date of deposit, we do not agree with this submission of the Ld. Counsel for the reason that the appellant has suo motu deposited an amount of ₹ 60 Lacs and admittedly the refund application for ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n 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 amount claimed is still not refunded. Thus, the only interpretation of Section 11BB that can be arrived at is that interest under the said Section becomes payable on the expiry of a period of three months from the date of receipt of the application under sub-section (1) of Section 11B of the Act and that the said Explanation does not have any bearing or connection with the date from which interest under Section 11BB of the Act becomes payable. 13. In view of ..... X X X X Extracts X X X X X X X X Extracts X X X X
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