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TMI Blog2024 (4) TMI 365X X X X Extracts X X X X X X X X Extracts X X X X ..... 2 and 3; and Mr. Gadi Praveen Kumar, learned Deputy Solicitor General of India for the respondent No.4. 3. The broad facts, for convenience without referring to the dates as the issues are in common, are that, the petitioners had filed a refund claim petition before the respondents claiming for refund of the unutilized ITC. Upon raising the said claim, the respondents issued a deficiency memo to which the petitioners promptly replied. Subsequently, show causes notices were issued to which also the petitioners replied and finally orders were passed rejecting the refund claims. The rejection of the refund claims was subjected to challenge in the appeals and the appeals filed by the petitioners were substantially allowed and refund amounts were also disbursed. 4. Later on the petitioners moved applications with the respondents requesting them for grant of interest on the amount refunded by them for the period it was withheld by the Department resulting in delayed releasing. In spite of persistent efforts by the petitioners, the interest on the delayed refunded amount was not granted. The request finally stood rejected by the Department vide orders dated 09.05.2022 and 19.02.2023 res ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed refund made by the Department. The very Section starts with the wordings that of any tax ordered to be refunded is not refunded within the stipulated period of time, interest at such rate shall be payable on the said refund amount. 7. Similarly, the proviso also to the said Section clearly envisages that of any claim of refund which arises from an order passed by the Adjudicating Authority or Appellate Authority or Appellate Tribunal or for that matter any Court of law and if the refund is not made within sixty (60) days, the said amount of refund would also carry interest at such rates notified by the Government. 8. In the given factual and statutory provisions, we are of the considered opinion that the Section, the proviso and its explanation provided to the Section does not provide for any circumstances or situation under which the delayed refund not attracting interest. If we also look into the provisions of Rule 94 of the CGST Rules, 2017, the said provision also provides for certain periods which shall not be included in the period for which the interest is payable. This in other words also means that interest on the delayed refund is automatic. As soon as there is a del ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... or itself. 25. In the overall view of the matter, we are inclined to hold the respondents liable to pay simple interest on the delayed payment at the rate of 9& per annum. The authority concerned shall look into the chart provided by the writ applicants, which is at Page-30. Annexure-D to the writ application and calculate the aggregate amount of refund. On the aggregate amount of refund, the writ applicants are entitled to 9% per annum interest from the date of filing of the GSTR-03. The respondents shall undertake this exercise at the earliest and calculate the requisite amount towards the interest. Let this exercise be undertaken and completed within a period of two months from the date of receipt of the writ of this order. The requisite amount towards the interest shall be paid to the writ applicants within a period of two months from the date of receipt of the writ of this order." 13. Similarly, the Bombay High Court also in the case of National Leather Cloth Mfg. Co. vs. Union of India and Ors (Writ Petition No.11421 of 2014 dated 19.01.2015 of the Bombay High Court) in paragraph No.7 has held as under: "7. The balance claim that remains is of interest on this sum. If th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... earned counsel for the assessee that in fact the issue stands concluded by the decision of this Court in U.P. Twiga Fiber Glass Ltd. (supra). In the said case, while dismissing the special leave petition filed by the revenue and putting its seal of approval on the decision of the Allahabad High Court, this Court had observed as under: "Heard both the parties. In our view the law laid down by the Rajasthan High Court succinctly in the case of J.K. Cement Works v. Assistant Commissioner of Central Excise & Customs reported in 2004 (170) E.L.T. 4 vide Para 33: "A close reading of Section 11BB, which now governs the question relating to payment of interest on belated payment of interest, makes it clear that relevant date for the purpose of determining the liability to pay interest is not the determination under sub- section (2) of Section 11B to refund the amount to the applicant and not to be transferred to the Consumer Welfare Fund but the relevant date is to be determined with reference to date of application laying claim to refund. The non- payment of refund to the applicant claimant within three months from the date of such application or in the case governed by proviso to S ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the provisions of Section 11BB of the Central Excise Act. There was no response to those letters for a long time, but ultimately by letter dated 1-1-2004 the petitioner was informed that the petitioner is not entitled to payment of any interest on the refund claim under Section 11BB of the Act. Against that letter, an appeal was filed before the Commissioner, Central Excise (Appeals). That appeal was rejected by order dated 20-12-2005, and therefore, a revision was filed before the Joint Secretary, Government of India, Ministry of Finance, Department of Revenue. That revision has been rejected by the order which is impugned in this petition. That Joint Secretary has held that the applications for refunds initially filed by the petitioner were incomplete and that those applications got completed only after the order was passed in the appeal dated 30-7-1999, and that payment of refund has been made within three months thereof, and therefore, no interest is payable to the petitioner. 8, Now it will be necessary to see the provision of Section 11BB of the Act which reads as under: Section 11BB Interest on delayed refunds. - If any duty ordered to be refunded under sub-section (2) ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ondly on close examination of the order of the appellate authority dated 30-7-1999 we find that is cannot be said that the application filed by the petitioner for refund was found to be so incomplete that it would not be termed as an application at all. The revisional authority in the order impugned has observed that the appellate authority found that a certificate from the authority was found necessary for establishing correlation by the appellate authority. Perusal of the order of the appellate authority does not show that production of the certificate was necessary for establishing correlation. Correlation was to be established by looking at the chassis number in the duty paying document executed at the time of payment of duty on the chassis with engine and the chassis number mentioned in the duty paying document executed at the time of payment of duty on the bus. The documents evidencing payment of duty at both the occasions were already available on record because it is only on the basis of those two documents that the Assistant Commissioner had recorded finding that the duty has been paid on both the occasions. It is, thus clear that the correlation could be established only ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... International vs. Commissioner of DGST and Anr. [2023 (11) TMI 958 - DELHI HIGH COURT] in paragraph Nos.15, 25, 26, 27, 33 and 34 has held as under: "15. The petitioner's entitlement for interest cannot be defeated merely because the proper officer passed an incorrect order, which is subsequently rectified in the appellate proceedings. 25. The object of providing payment of interest after the expiry of sixty days from the date of the refund application is to ensure that a taxpayer is adequately compensated for denial of the funds that were legitimately due to it after accounting for a reasonable period of sixty days for processing its claim. The right of a taxpayer to receive such compensation would be severally diluted if the reference to the date of receipt of application under Section 54(1) of the CGST Act, in Section 56 of the CGST Act is construed to mean the date of an application for refund filed subsequently - that is, after the first application for refund is rejected in whole or in part - pursuant to the orders passed by the appellate fora. 26. We are of the view that on a plain reading of the main provisions of Section 56 of the CGST Act, a taxpayer would be entit ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y days after filing of his second application pursuant to the appellate orders. In another words, the proviso merely enhances the interest payable to a person for the period commencing from the date immediately after sixty days from the date of his application filed pursuant to its entitlement to refund claim attaining finality. 34. The applications for refund filed pursuant to orders passed by the Appellate Authority, do not invite any fresh adjudication. The said applications are merely to implement the orders already passed. Sensu stricto, such application is only for the purposes of convenience and to retrigger the processing of the refund claimed. It is obvious that the petitioner's claim for refund cannot be subjected to repeated rounds of adjudication by the Adjudicating Authority. Once an application for refund under Section 54(1) of the CGST Act has been filed, the same requires to be carried to its logical conclusion. If the said claim is denied by the Adjudicating Authority and the applicant prevails before the Appellate Authority, the order of the Appellate Authority is required to be implemented. However, in one sense, the subsequent application filed by a person ..... X X X X Extracts X X X X X X X X Extracts X X X X
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