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TMI Blog2022 (9) TMI 270X X X X Extracts X X X X X X X X Extracts X X X X ..... Act, 1944 or will it be governed by amended Section 35FF ibid entitling interest from the date of pre-deposit? 3. The facts of the case in brief are as follows. The appellant is engaged in manufacture and supply of non-alcoholic beverages and fruit pulp based products under the franchise agreement with Coca Cola Company (USA). Service tax was demanded from the appellants by way of two show cause notices dated 9.9.2010 and 23.10.2011 respectively totaling Rs.3,74,67,511/- for the period 1.4.2005 to 26.2.2010 and also for Financial Year 2010-11, which was confirmed by the Adjudicating Authority. When the appellants filed appeal before this Tribunal alongwith stay application, while hearing the stay application they were directed to deposit 50% of the service tax amount with proportionate interest vide order dated 19.9.2013 of the Tribunal in Appeal No. ST/716/2012. Aggrieved, the appellant filed appeal before the Hon'ble High Court of Punjab & Haryana at Chandigarh being CEA No. 97 of 2013 (O&M) and the Hon'ble High Court vide order dated 22.4.2014 disposed of the appeal and directed the appellant to deposit a sum of Rs.50 lacs as a condition precedent for hearing of the appeal. Acc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 1 B ibid is illegal. Per contra learned Authorised Representative appearing for the Revenue submits that as the pre-deposit was made on 25.6.2014 under erstwhile Section 35F ibid as per the directions of the Hon'ble High Court therefore any interest liability on the said amount has to the dealt with in accordance with the relevant statutory provisions of that period. According to learned Authorised Representative the decision of this Tribunal in the matter of Riba Textile (supra) is not applicable on the facts of this case as in that matter the deposit was made prior to 10.5.2008 i.e. prior to the insertion of section 35FF whereas in the instant matter the pre-deposit was made during the period when unamended section 35FF was in force. He further submits that the very same Bench of the Tribunal, which had passed order in Riba Textile, subsequently passed two orders in favour of Revenue on identical issue in the matter of Saluja Motors Pvt. Ltd. vs. Commr. CE&ST, Chandigarh-I; Final Order No. 60414/2020, dated 3.12.2020 and also in the matter of Modern Diaries Ltd. vs. CGST, Panchkula; Final Order No. 60413/2020, dated 3.12.2020, in which it has been decided that the assessee therei ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ot exceeding thirty-six per cent per annum as is for the time being fixed by the Central Government, by notification in the Official Gazette, on such amount from the date of payment of the amount till the date of refund of such amount: Provided that the amount deposited under section 35F, prior to the commencement of the Finance (No.2) Act, 2014, shall continue to be governed by the provisions of Section 35FF as it stood before the commencement of the said Act." A perusal of the aforesaid provisions would make it clear that earlier i.e. upto 6.8.2014, the interest was liable to be paid only in the case of delay beyond three months in granting the refund from the date of communication of order passed by the Commissioner (Appeals) or the Tribunal, whereas post 6.8.2014, this has been changed and an interest has been made payable at a rate not below 5% and not exceeding 36% p.a. as is for the time being fixed by the Central Government by notification in the official gazette on such amount from the date of payment of amount till the date of refund of such amount. Proviso has also been added to it that any amount deposited under this section prior to the amendment, shall continue to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the core issue in Sandvik case (supra). The only issue formulated by this Court for its consideration and decision was whether an assessee is entitled to be compensated by the Income Tax Department for the delay in paying interest on the refunded amount admittedly due to the assessee. This Court in the facts of the said case had noticed that there was delay of various periods, ranging from 12 to 17 years, in such payment by the Revenue. This Court had further referred to the several decisions which were brought to its notice and also referred to the relevant provisions of the Act which provide for refunds to be made by the Revenue when a superior forum directs refund of certain amounts to an assessee while disposing of an appeal, revision etc. 5. Since, there was an inordinate delay on the part of the Revenue in refunding the amount due to the assessee this Court had thought it fit that the assessee should be properly and adequately compensated and therefore in paragraph 51 of the judgment, the Court while compensating the assessee had directed the Revenue to pay a compensation by way of interest for two periods, namely; for the Assessment Years 1977-78, 1978-79, 1981-82, 1982-8 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... o interference. Accordingly, the appeal is rejected and the impugned order is upheld." 10. In the light of the discussions made in the preceding paragraphs, I am of the considered opinion that in the instant matter the interest on refund has to be dealt with in accordance with the erstwhile section 35FF which clearly mandates the payment of interest only if there was a delay beyond three months. The statutory period prescribed therein is 3 months from the date of communication of the order of the Appellate Authority. While going through the case records I find that based on the Final Order dated 19.2.2020 of this Tribunal, the refund of Rs.50 lacs came to be sanctioned by the authority concerned vide Order-in-Original dated 28.10.2020 that too when the appellant sent letter dated 22.7.2020 to the department requesting refund of the amount of pre-deposit alongwith applicable interest from the date of pre-deposit. The department cannot take advantage of lethargy on their part. This is not proper to say that the order is not received in Central GST Commissionerate, Chandigarh. The statute uses the word 'communication of the order of appellate authority' and that cannot be construed a ..... X X X X Extracts X X X X X X X X Extracts X X X X
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