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CX - Tribunal, not being court of equity, it is difficult to entertain prayer of appellant for grant of interest from date of deposit made in accordance with HC order: CESTAT

By TIOL News Service

MUMBAI, DEC 11, 2017: IN adjudication, a duty demand of Rs.12,56,336/- was confirmed against the appellant by the adjudicating authority.

Without seeking appeal remedy before Commissioner (Appeals), the appellant filed a Writ Petition before the Bombay High Court praying that there should be no levy of anti dumping dutyduring intervening period i.e. between the period of expiry of provisional notification and issuance of definitive levy notification.

They also made an interim application in that Writ Petition praying leave of Court to deposit duty element of Rs.12,56,336/- with interest. The High Court allowed the prayer and the appellant made such deposit on 19.2.2007.

The writ petition went against appellant and consequently the petitioner filed a Civil Appeal before the Supreme Court which was disposed on 23.9.2015 holding that there shall be no levy of anti-dumping duty during the intervening period aforesaid.

Thereafter, the appellant filed a claim for refund and also sought interest from the date of deposit.

However, the Adjudicating Authority rejected such prayer of interest and this order was confirmed by the Commissioner (Appeals).

Therefore, the appellant is before the CESTAT.

The AR submitted that as soon as the Supreme Court judgment was delivered and application dated 18.1.2016 was filed by appellant seeking refund,the same was granted on 22.3.2016. Therefore, refund having been paid without any lapse of time and that too within three months from the date of application, no interest is admissible.

After considering the submissions, the Bench extracted sections 11B and 11BB of the CEA, 1944 and observed -

+ it is mandate of Section 11BB that in terms of order under sub-section (2) of Section 11B, if the refund is not granted within three months from the date of application, interest in accordance with the provision contained in Section 11BB is payable.

+ this establishes that to make refund, an order for refund is sine qua non under Section 11B(2) of Central Excise Act, 1944.

+ explanation to Section 11BB states that if any order of refund is made by any court, that is deemed to be an order passed under sub-section (2) of Section 11B. Therefore, harmonious reading of the provisions contained in Section 11B and Section 11BB demonstrates that an order of refund under Section 11B(2) is pre-requisite and default in carrying out the provision of Section 11BB gives rise to interest. [Ranbaxy Laboratories Ltd. vs. UOI - 2011-TIOL-105-SC-CX and CCE, Pune-III vs. Ballarpur Industries Ltd . - 2009-TIOL-34-HC-MUM-CX relied upon.]

+ tribunal not being the court of equity, it is difficult to entertain the prayer of the appellant for grant of interest from the date of deposit of the amount made in accordance with the order of Hon'ble High Court.

The appeal was dismissed.

(See 2017-TIOL-4354-CESTAT-MUM)


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