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TMI Blog2025 (1) TMI 1261X X X X Extracts X X X X X X X X Extracts X X X X ..... able from the date of payment till the date of refund @12% per annum. It is pertinent to note that the review application filed by the Revenue against this judgment has also been rejected by the Hon'ble Punjab & Haryana High Court - the Hon'ble Punjab & Haryana High Court in the case of Sunrise Immigration Consultants Private Limited vs. Union of India [2023 (4) TMI 504 - CESTAT CHANDIGARH], after relying upon the decision in the case of Riba Textiles Limited, has re-affirmed that the petitioner was entitled to refund of the amount deposited during investigation along with interest @12% computable from the date of deposit of the amount till the date of refund. Rate at which the interest is to be computed - HELD THAT:- The Tribunal as well as various Courts in catena of decisions have consistently held that interest is payable from the date of deposit till the date of refund @12% per annum. In this regard, we may refer to the decision of the Tribunal in the case of Indore Treasure Market City Pvt. Ltd. [2024 (5) TMI 367 - MADHYA PRADESH HIGH COURT] wherein the Tribunal after considering the various decisions of the Courts, has held that the assessee is entitled for interest ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the provision of passive infrastructure support services to various telecom companies such as Vodafone, Bharti Airtel etc. For providing such services, the appellant had purchased various capital goods namely lead acid batteries, electric generator sets, air conditioners, power interface unit, Switch Mode Power Systems, battery banks etc and had availed CENVAT Credit of the excise duties paid thereon in terms of the Cenvat Credit Rules, 2004. 2.2 In year 2014, investigation proceedings were initiated by the Directorate General of Central Excise Intelligence (in short 'DGCEI') with respect to the clearance of capital goods as waste and scrap by the appellant without payment/reversal of the amount during the periods from 01.03.2011 to 16.03.2012 and 27.09.2013 to 31.03.2015. During the course of the investigation, the appellant, without admitting liability, deposited an amount of Rs.12,00,00,000/- under protest. Further, the dispute was decided by the Division Bench of the CESTAT, New Delhi in favour of the appellant vide Final Order No. 50932/2022 dated 26.09.2022. 2.3 Pursuant to the said final order, the appellant had filed a refund application dated 29.09.2022 before the As ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he settled law that amounts paid during the investigation stage under protest are refundable from the date of deposit till the date of refund upon determination of dispute in the favour of the taxpayer. In this regard reliance is placed on the decision of the Hon'ble Apex Court in the case of Sandvik Asia Limited vs. Commissioner of Income Tax - 2006 (2) SCC 508, wherein the Hon'ble Supreme Court has laid down the principle that where an amount was due to an assessee from the department, such amount is required to be refunded to the assessee with applicable interest for the entire period from the date of deposit till the date of refund. The Hon'ble Supreme Court has further held that this interest is in the form of compensation to the assessee for retaining the deposited amounts for extended periods of time without the authority of law, causing financial difficulties for the assessee, the liability to pay such interest arises from the provisions of the Income Tax Act, 1961. In this regard, he also relies on the decision of the Hon'ble Punjab & Haryana High Court in the case of CCE, Panchkula vs. Riba Textiles Limited - 2022 (62) G.S.T.L. 136 (P&H), wherein the Hon&# ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 00,00,000/- would be applicable @6% per annum, and not 12% per annum, as sought by the appellant. He further submits that various High Courts and benches of the Tribunal consistently have held that interest on refund of deposits made during investigations is required to be computed @12% per annum. He further submits that in the cases of Riba Textiles Limited (supra) and Sunrise Immigration Consultants Private Limited (supra), the jurisdictional High Court of Punjab & Haryana has already held that the rate of interest applicable in such cases is @12% per annum. He further submits that the decision of the jurisdictional High Court of Punjab & Haryana in the case of Riba Textiles Limited (supra) has been followed by this Tribunal in the cases of Sunrise Immigration Consultants Private Limited vs. CGST, Chandigarh - 2023 (4) TMI 504 - CESTAT CHANDIGARH and Impressive Management Solutions Pvt. Ltd. vs. CGST, Chandigarh - 2023 (4) TMI 433 CESTAT CHANDIGARH. Besides this, he also relies on the following case-laws to support his argument that the interest computed should be @12% per annum: CCE, Hyderabad vs. ITC Ltd. - 2004 (12) TMI 90 - Supreme Court Nelco Limited vs. Union of India - ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... llant could not have been made prior to the Bharti OIO attaining finality. Besides this, he also relies on the following decisions, wherein it has been held that Section 11 of the Central Excise Act, 1944 does not contemplate the adjustment of refund amount due to the assessee towards any amount due to the Revenue: CCE, Bangalore-III vs. Stella Rubber Works (Unit-II) - 2012 (275) ELT 404 (Kar.) CCE, Mumbai-I vs. Johnson & Johnson Ltd. - 2016 (335) ELT 163 (Tri. - Mumbai) Central Arecanut and Cocoa Marketing and Processing Co Operative Ltd vs. CCE & ST, Mysore - 2017 (3) TMI 931 - CESTAT BANGALORE He also prays that the refund of Rs.64,73,631/- retained by the tax authorities should be refunded to the appellant along with interest @12% per annum computed from the date of deposit till the date of refund. 5.1 On the other hand, the learned Special Counsel for the Revenue reiterates the findings of the impugned order. Further, he submits that as regards the prayer of the appellant that they are entitled to refund of the amount deposited during investigation, the relevant provisions to deal with the issue are Section 35F and Section 35FF of the Central Excise Act, 1944 which are ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... a as the same has been decided by the Hon'ble Apex Court in the case of Sandvik Asia Limited vs. Commissioner of Income Tax (surpa), which has been followed by the jurisdictional High Court of Punjab & Haryana in the case of Riba Textiles Limited (supra), wherein the Hon'ble High Court has upheld the order of the Tribunal granting interest on refund to the assessee computable from the date of payment till the date of refund @12% per annum. It is pertinent to note that the review application filed by the Revenue against this judgment has also been rejected by the Hon'ble Punjab & Haryana High Court as reported at 2022 (5) TMI 1531 - PUNJAB & HARYANA HIGH COURT. 7.2 We also note that the Hon'ble Punjab & Haryana High Court in the case of Sunrise Immigration Consultants Private Limited vs. Union of India - (supra), after relying upon the decision in the case of Riba Textiles Limited (supra), has re-affirmed that the petitioner was entitled to refund of the amount deposited during investigation along with interest @12% computable from the date of deposit of the amount till the date of refund. 8.1 Regarding the rate at which the interest is to be computed, we find that the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... al and, in this appellate jurisdiction, such interpretation does not call for any interference. Further, as to the quantum of interest awarded, the Tribunal, which is a specialised body dealing in matters pertaining to excise duty, took into account the previous judgments of the Supreme Court, High Courts and the Tribunal itself to justify that the rate of 12 per cent per annum would apply in the facts of the present case. Again, since there is some basis to the award of interest by the Appellate Tribunal, the same does not call for any interdiction." 8.3 We also find that in the case of Raghuveer Metal Industries Ltd (supra), the Tribunal has held that the appellant is entitled to receive interest at the rate of 12% from the date of deposit of the amount till the date of refund thereof. 8.4 In view of the decisions cited supra, we are of the considered view that the appellant is entitled to receive interest on the amount deposited during investigation from the date of deposit of the amount till the date of its refund at the rate of 12% per annum. 9.1 Regarding the adjustment of the amount Rs.64,73,631/- from the total refund sanctioned to the appellant, we find that the Adjudic ..... X X X X Extracts X X X X X X X X Extracts X X X X
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