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TMI Blog2023 (8) TMI 932X X X X Extracts X X X X X X X X Extracts X X X X ..... language as employed in Section 30(1) itself takes the case of refund of pre-deposit out from the rigors of the procedural formalities which are contemplated therein. We further note that as in the present case, claims for refund which may arise as a consequence of an order passed by the Appellate Authority or a Court would be governed by Section 30(4) of the Act - The same position would also appear to flow from a reading of Rule 29 and which contemplates Form ST- 21 and Form ST-22 being moved by an assessee when claiming refund. Rule 29 (2) speaks of an application for refund of any tax or penalty imposed under Section 30(1) or reimbursement of tax under Section 30(8). Neither sub-section (1) nor sub-section (8) of Section 30 deal with the subject of refund of pre-deposit. Thus, a pre-deposit would become refundable the moment an Appellate Authority comes to hold in favour of the assessee and demands come to be annulled. This principally since pre-deposit is not tax or duty and the refund of which alone is regulated by Section 30(1) of the Act - the decision of the Bombay High Court in SUVIDHE LTD. VERSUS UNION OF INDIA [ 1996 (2) TMI 136 - BOMBAY HIGH COURT] was assailed bef ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... December 2017 by the Tribunal. 5. The petitioner states that by a subsequent letter dated 18 April 2018, he raised a request for refund being effected by the respondents. The respondents in the meanwhile approached this Court by way of an appeal against the order of the Tribunal dated 04 December 2017 which came to be dismissed on 26 November 2018. It is, thereafter, that the petitioner moved yet another letter dated 10 January 2019 for refund being effected. In the meanwhile, the Special Leave Petition preferred by the respondents against the order dated 26 November 2018 passed by this Court on their appeal also came to be dismissed on 10 January 2020. Since the issue of refund was not decided or attended to, the petitioner ultimately instituted the present proceedings. 6. Learned counsel for the petitioner submitted that the Court has consistently taken the position that a pre-deposit made for the purposes of pursuing an appeal under the Act cannot be treated as duty and can neither be adjusted against any other pending demands or dues nor is the assessee obliged to move any formal application for the purposes of its refund once the appeal itself has come to be disposed of. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... , 1944 (sic) is impugned in the present petition. The aforesaid amount is deposited by the Petitioners not towards Excise Duty but by way of deposit under Section 35F for availing the remedy of an appeal. Appeal of the petitioners has been allowed by the Appellate Tribunal by its Judgment and order passed on 30th of November, 1993 with consequential relief. Petitioners' prayer for refund of the amount deposited under Section 35F has not received a favourable response. On the contrary the impugned show cause notice is issued why the amount deposited should not be forfeited. In our judgment, the claim raised by the Department in the show cause notice is thoroughly dishonest and baseless. In respect of a deposit made under Section 35F, provisions of Section 11B can never be applicable. A deposit under Section 35F is not a payment of Duty but only a pre-deposit for availing the right of appeal. Such amount is bound to be refunded when the appeal is allowed with consequential relief. 3. In respect of such a deposit the doctrine of unjust enrichment will be inapplicable. In the circumstances, the petition succeeds. The impugned show cause notice, which is annexed at Exhibit-F t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... More so since, once the Scheme is announced and specified to be commenced from the 1st day of the relevant financial year, for a specified period, it may not be proper for the State/Department to augment the revenue collection by resorting to coercive steps before the defaulters get an opportunity to apply for and obtain the benefit of the Scheme, which otherwise can only defeat or frustrate the Scheme itself and in turn, the Policy‟ of the Government. In the above circumstances, this Court finds that the course pursued by the respondents; issuing Ext. PA rejecting Ext. P2 preferred by the petitioner seeking the amount deposited as a token of willingness to clear the liability availing the benefit of the Scheme proposed in Ext. PI and consciously appropriating the said amount against interest portion under the cover of Section 55C, is not correct or sustainable. Accordingly, Ext.P4 is set aside. The respondents are directed to pass fresh orders quantifying the liability of the petitioner, in the application preferred for extending the benefit under the Amnesty Scheme , giving credit to a sum of Rs. 75,000/- paid by him vide Ext. P2, as payment towards a portion o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... petition succeeds. The impugned show cause notice, which is annexed at Exhibit-F to the petition, is quashed and the respondents are directed to forthwith refund the aforesaid amount of Rs. 14,07,410/- alongwith interest thereon at the rate of 15% p.a. from the date of the order of the Appellate Tribunal i.e. from 30th November, 1993 till payment. 5. Rule is made absolute in the aforestated terms. Respondents will pay the petitioners the cost of the petition. In view of the above, it was submitted that the petitioner is entitled to refund as well as interest in terms of the provisions made in the Act calculated from 04 December 2017, that is the date of the order passed by the Tribunal. 8. Controverting the aforesaid submissions, Mr. Aggarwal, learned counsel appearing for the respondents, submitted that Section 30 of the Act lays down a detailed procedure which must be adhered to when claiming a refund. According to Mr. Aggarwal, in the absence of a formal application having been duly made in accordance with the timelines prescribed therein, the claim for refund would not automatically ensue. It was also his contention that the judgment rendered by the Court in MRF ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... st apply such excess towards the recovery of any amount in respect of which a notice under section 25 has been issued and shall then refund the balance, if any. Explanation.- When no assessment is made, the due tax paid under section 21 by the dealer shall be deemed to be the tax payable under this Act. (2) Where on account of death, incapacity, insolvency, liquidation or other cause a person is unable to claim or receive any refund due to him, his legal representative or the trustee or guardian or receiver, as the case may be, shall be entitled to claim or receive such refund for the benefit of such person or his estate. (3) No claim for refund under sub-section (1) shall be allowed unless it is made within a period of twelve months from the date of the order giving rise to a claim for such refund, and the Commissioner shall, except as otherwise provided in this Act, refund any amount which becomes due to a dealer in the prescribed manner : Provided that the Commissioner may allow a claim for refund to be made after the expiry of the said period but not later than twelve months from such expiry, if he is satisfied that there was sufficient cause for not mak ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ing of sub-section (1), the said provision relates to a claim made by a person for refund of an amount of tax paid by him. The express language as employed in Section 30(1) itself takes the case of refund of pre-deposit out from the rigors of the procedural formalities which are contemplated therein. We further note that as in the present case, claims for refund which may arise as a consequence of an order passed by the Appellate Authority or a Court would be governed by Section 30(4) of the Act. 14. The same position would also appear to flow from a reading of Rule 29 and which contemplates Form ST- 21 and Form ST-22 being moved by an assessee when claiming refund. Rule 29 (2) speaks of an application for refund of any tax or penalty imposed under Section 30(1) or reimbursement of tax under Section 30(8). Neither sub-section (1) nor sub-section (8) of Section 30 deal with the subject of refund of pre-deposit. 15. In our considered opinion a pre-deposit would become refundable the moment an Appellate Authority comes to hold in favour of the assessee and demands come to be annulled. This principally since pre-deposit is not tax or duty and the refund of which alone is regulate ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... is the order dated 7-8-1996 which was passed by this Court in Union of India v. Suvidha Ltd. [Union of India v. Suvidha Ltd., (2016) 11 SCC 808 : (1997) 94 ELT A-159 (SC)] dismissing the special leave petition which was filed by the Union of India against the judgment of the High Court of Bombay in Suvidhe Ltd. v. Union of India [Suvidhe Ltd. v. Union of India, (1996) 82 ELT 177 (Bom)] . Since the special leave petition was dismissed in limine, we would like to reproduce para 2 of the judgment of the High Court wherein the High Court had observed that in case of such deposits, provisions of Section 11-B of the Customs Act (sic Central Excise Act, 1944) will have no application. This para reads as under : (Suvidhe Ltd. case [Suvidhe Ltd. v. Union of India, (1996) 82 ELT 177 (Bom)] , ELT p. 178) 2. Show-cause notice issued by the Superintendent (Tech.) Central Excise to the petitioner to show cause why the refund claim for excise duty and redemption fine paid in a sum of Rs 14,07,410 should be denied under Section 11-B of the Central Excise Rules and Act, 1944 (sic) is impugned in the present petition. The aforesaid amount is deposited by the petitioners not towards excise duty ..... X X X X Extracts X X X X X X X X Extracts X X X X
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