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TMI Blog2025 (4) TMI 183X X X X Extracts X X X X X X X X Extracts X X X X ..... dated 29.05.2020 sanctioned refund amount of Rs.44,87,775/- in terms of Rule 5 of Cenvat Credit Rules, 2004 read with Notification No. 05/2006- CE (N.T.) dated 14.03.2006. The appellant filed an appeal against this order claiming interest on the amount sanctioned as refund from the date of expiry of 3 months from the date of receipt of the refund application. The Commissioner (Appeals) vide Order-in-Appeal No. 248-249/2023 dated 15.05.2023 observing that the issue on interest was not placed before the original authority remanded the matter to the original authority for examining and deciding the issue of interest liability on delayed refunds. Aggrieved by this remand order, the appellant is in appeal before the Tribunal. 3. The Learned Counsel on behalf of the appellant submitted that the Tribunal vide Final Order Nos. 20304-20313/2018 dated 20.02.2018 had allowed their appeal for interest which was contested by the Revenue and the Hon'ble High Court of Karnataka in their own case in the case of Commissioner of Central Tax, Bengaluru Vs. Netapp India Pvt. Ltd. 2019 (367) E.L.T. 145 (Kar.) dated 1-3-2019 observed as follows: "11. The Learned Counsel for the appellant-Revenue is u ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ity for grant of interest. Simultaneously, Board would like to draw attention to Circular No. 398/31/98-CX, dated 2-6-98 [1998 (100) E.L.T. T16] wherein Board has directed that responsibility should be fixed for not disposing of the refund/rebate claims within three months from the date of receipt of application. Accordingly, jurisdictional Commissioners may devise a suitable monitoring mechanism to ensure timely disposal of refund/rebate claims. Whereas all necessary action should be taken to ensure that no interest liability is attracted, should the liability arise, the legal provision for the payment of interest should be scrupulously followed." 3.2 The Learned Counsel also relies on the following decisions: * Ranbaxy Laboratories Ltd.: 2011 (237) ELT 3 (S.C.) * Commissioner of Central Excise, Pune - II Vs. M/s. Sulaki Chemicals Pvt. Ltd.: 2014 TIOL-363-HC-MUM-Cx. * Commissioner of Central Excise Vs. Reliance Industries Ltd.: 2010 (259) ELT 356 3.3 The Learned Counsel also submits that it is a settled principle that the power of remand should be exercised restrictively with due guidance/directions. To substantiate the same, they placed reliance on the decision rendered i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e same is remanded to examine the submissions of the appellant and accordingly, he remanded the issue of interest liability on delayed refunds. The appellant is aggrieved on the ground that once refund is sanctioned, interest liability arises automatically and hence, the Commissioner (Appeals) should have directed the lower authority to sanction the interest instead of remanding the matter for examining the interest liability. The question of interest on delayed refunds is no longer res integra in as much as the Hon'ble Supreme Court of India in the case of Ranbaxy Laboratories Ltd. Versus Union of India 2011 (273) E.L.T. 3 (S.C.) 2011 (273) E.L.T. 3 (S.C.) 21-10-2011 referring to the relevant sections held as follows: "11B. Claim for refund of duty. - (1) Any person claiming refund of any duty of excise and interest, if any, paid on such duty may make an application for refund of such duty and interest if any, paid on such duty to the Assistant Commissioner of Central Excise or Deputy Commissioner of Central Excise before the expiry of one year from the relevant date in such form and manner as may be prescribed and the application shall be acc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... terest, if any, paid on such duty to any other person; (f) the duty of excise and interest, if any, paid on such duty borne by any other such class of applicants as the Central Government may, by notification in the Official Gazette, specify: Provided further that no notification under clause (f) of the first proviso shall be issued unless in the opinion of the Central Government, the incidence of duty and interest, if any, paid on such duty has not been passed on by the persons concerned to any other person. (3) Notwithstanding anything to the contrary contained in any judgment, decree, order or direction of the Appellate Tribunal of any Court in any other provision of this Act or the rules made thereunder or any other law for the time being in force, no refund shall be made except as provided in sub-section (2). (4) ....................................................................................... (5) ....................................................................................... Section 11BB, the pivotal provision, reads thus: "11BB. Interest on delayed refunds. - If any duty ordered to be refunded under sub-section (2) of section 11B to any applican ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... an order made under sub-section (2) of Section 11B of the Act. It is clear that the Explanation has nothing to do with the postponement of the date from which interest becomes payable under Section 11BB of the Act. Manifestly, interest under Section 11BB of the Act becomes payable, if on an expiry of a period of three months from the date of receipt of the application for refund, the amount claimed is still not refunded. Thus, the only interpretation of Section 11BB that can be arrived at is that interest under the said Section becomes payable on the expiry of a period of three months from the date of receipt of the application under sub-section (1) of Section 11B of the Act and that the said Explanation does not have any bearing or connection with the date from which interest under Section 11BB of the Act becomes payable. 10. It is a well settled proposition of law that a fiscal legislation has to be construed strictly and one has to look merely at what is said in the relevant provision; there is nothing to be read in; nothing to be implied and there is no room for any intendment. [See: Cape Brandy Syndicate v. Inland Revenue Commissioners, [1921] 1 K.B. 64 and Ajmera Housing Co ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ant of interest. Simultaneously, Board would like to draw attention to Circular No. 398/31/98-CX., dated 2-6-98 [1998 (100) E.L.T. T16] wherein Board has directed that responsibility should be fixed for not disposing of the refund/rebate claims within three months from the date of receipt of application. Accordingly, jurisdictional Commissioners may devise a suitable monitoring mechanism to ensure timely disposal of refund/rebate claims. Whereas all necessary action should be taken to ensure that no interest liability is attracted, should the liability arise, the legal provision for the payment of interest should be scrupulously followed." ( Emphasis supplied ) 12. Thus, ever since Section 11BB was inserted in the Act with effect from 26th May 1995, the department has maintained a consistent stand about its interpretation. Explaining the intent, import and the manner in which it is to be implemented, the Circulars clearly state that the relevant date in this regard is the expiry of three months from the date of receipt of the application under Section 11B(1) of the Act. 13. We, thus find substance in the contention of learned counsel for th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the above analysis, our answer to the question formulated in para (1) supra is that the liability of the revenue to pay interest under Section 11BB of the Act commences from the date of expiry of three months from the date of receipt of application for refund under Section 11B(1) of the Act and not on the expiry of the said period from the date on which order of refund is made". 6. In similar circumstances, as in the present case, the Hon'ble High Court of Bombay in the case of QUALCOMM India Pvt. Ltd. Versus Union of India 2021 (50) G.S.T.L. 269 (Bom.) referring to the decision of the Hon'ble Supreme Court as discussed above and the Board Circular observed as follows : "17.1 From a reading of Section 11BB as extracted above, it is evident that if any duty ordered to be refunded under sub-section (2) of Section 11B to any applicant is not refunded within three months from the date of receipt of application under sub-section (1) of Section 11B, there shall be paid to that applicant interest at such rate which is not below 5% and not above 30% per annum as may be fixed by the Central Government, by notification in the Official Gazette. The interest will be calculated for the p ..... X X X X Extracts X X X X X X X X Extracts X X X X
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