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TMI Blog2024 (7) TMI 7X X X X Extracts X X X X X X X X Extracts X X X X ..... ection 11B of Customs Act or Section 35FF of Central Excise Act. It was held by the Hon'ble Apex Court that in such cases of refund even the concept of unjust enrichment is not applicable. Once it is clear that Section 11B and 11BB of Central Excise Act will not be applicable to the amount in question, the denial of the interest on the appellant s amount is held to be unjustified. As per the Article 300A of Constitution of India also, no person shall be deprived of his property, save by authority of law. He cannot be deprived of the same and is entitled for benefits arising out of said property. Hence interest accrued on the amount in question during the period it remained deposited with the department is the property of the owner of the amount i.e. the appellant herein - the appellants are entitled to claim the interest on the amount as has been refunded in their favour that too to be paid from the date of payment of initial amount till the date of its refund. Rate at which the such interest has to be awarded - HELD THAT:- The amount in question was an amount in the form of pre-deposit. Hence, it is the refund in terms of Section 35FF. However, the interest on sanctioned amoun ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e rejected vide Show Cause Notice No. 121 dated 17.02.2021 on the ground of it being time barred alleging that it should have been filed within one year from 09.05.2018, the date of order of Hon ble Rajasthan High Court. 1.2 The said proposal was initially rejected vide Order-in-Original No. 01/2021-22 dated 09.04.2021. However, Commissioner (Appeals) vide Order-in-Appeal No. 197/2021 dated 25.08.2021 had remanded the matter to original adjudicating authority directing to pass appropriate order in terms of Order-in-Appeal No. 554/RM/CE/JPR-II/2003 dated 28.11.2003 and representation of appellant made on 20.06.2018, 21.07.2018 and 19.12.2018. Pursuant to these directions of remand Order-in-Original No. 07/2021-22 dated 12.11.2021 was passed sanction the interest refund of claim of Rs.51,17,454/- holding that clause of unjust enrichment is not applicable in the instant case. This order was appealed by the department and their appeal has been allowed vide impugned Order-in-Appeal No. 55/2022 dated 01.03.2023. Being aggrieved the appellant is before this Tribunal. 2. I have heard Shri Gaurav Dadhich, learned Company Secretary for the appellant and Shri V.J. Saharan, learned Authorized ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... not be applicable. This is for the reason that the appellant was not claiming refund of duty. The applicant, as noticed above, had claimed refund of the revenue deposit. Such a finding has also been clearly recorded by the Tribunal in the order dated 31.01.2017, which order has attained finality. 31. Section 11D of the Excise Act deals with duties of excise collected from the buyer to be deposited with Central Government. It provides that every person who is liable to pay duty and has collected any amount in excess of the duty assessed from the buyer of such goods in any manner as representing duty of excise, shall forthwith pay the amount so collected to the credit of the Central Government. 32. Section 11DD of the Excise Act deals with interest on the amount collected in excess of the duty. It provides that where an amount has been collected in excess of the duty from the buyer of such goods, the person who is liable to pay such amount shall, in addition to the amount, be liable to pay interest at such rate not below ten per cent., and not exceeding thirty six per cent per annum, as is for the time being fixed by the Central Government, by notification in the Official Gazette. 33 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n question is an amount of interest claimed on the amount sanctioned as Refund. The said amount had no authority to retain as the appellant was the owner thereof. 9. From the above discussion, once it is clear that Section 11B and 11BB of Central Excise Act will not be applicable to the amount in question, the denial of the interest on the appellant s amount is held to be unjustified. As per the Article 300A of Constitution of India also, no person shall be deprived of his property, save by authority of law. He cannot be deprived of the same and is entitled for benefits arising out of said property. Hence interest accrued on the amount in question during the period it remained deposited with the department is the property of the owner of the amount i.e. the appellant herein. I draw my support from the decision of Hon'ble High Court of Allahabad in the case of RHL Profiles Ltd. Vs. Commissioner of Customs, Ex. and Service Tax, Kanpur reported as 2017 (352) ELT 349 (All) has held that once the confiscation has been set aside, confiscation of seized currency has been set aside and the fact is that the Department has earned interest during the period the currency was retained by it ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... they are liable to pay interest only upto the date of refund of tax while they take the benefit of assesses funds by delaying the payment of interest on refunds without incurring any further liability to pay interest. This stand taken by the respondents is discriminatory in nature and thereby causing great prejudice to the lakhs and lakhs of assesses. Very large number of assesses are adversely affected inasmuch as the Income Tax Department can now simply refuse to pay to the assesses amounts of interest lawfully and admittedly due to that as has happened in the instant case. It is a case of the appellant as set out above in the instant case for the assessment year 1978-79, it has been deprived of an amount of 40 lakhs for no fault of its own and exclusively because of the admittedly unlawful actions of the Income Tax Department for periods ranging up to 17 years without any compensation whatsoever from the Department. Such actions and consequences, in our opinion, seriously affected the administration of justice and the rule of law. COMPENSATION: 46. The word 'Compensation has been defined in P. RamanathaAiyar's Advanced Law Lexicon 3rd Edition 2005 page 918 as follows: An ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... .03.0211 under Section 11AB wherein Central Government has fixed the rate of interest at 18% per annum for the purpose of the said section. From the above notifications, issued under the respective sections of the Act, it becomes clear that the rate of interest varies from 6% to 18%. 13. This Tribunal in the case of M/s. Parle Agro Pvt. Ltd. Vs. Commissioner, Central Goods Service Tax, Noida (vice- Versa) reported as 2021 (5) TMI 870 CESTAT ALLHABAD has held that in the light of the above discussed notifications the grant of interest at the rate of 12% per annum seems to be appropriate. The decision of Hon ble Apex Court in the case of Sandvik Asia Ltd. (supra) has also been relied upon. Hon ble High Court of Kerala also in the case of Sony Pictures Networks India Pvt. Ltd. (supra) has held that the interest on the refund shall be payable at the rate of 12% per annum. The previous judgment of Hon ble Apex Court in the case of I.T.C. Ltd. (supra) has been relied upon, where the Apex court confined the rate of interest to 12% and further held that any judgment or decision of any high court taking a contrary view will be no longer a good law. The case law as relied upon by the appella ..... X X X X Extracts X X X X X X X X Extracts X X X X
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