By TIOL News Service

BANGALORE, APRIL 16, 2018: THE assessee filed refund claims under Rule 5 of CCR, 2004.

The Assistant Commissioner partially sanctioned an amount of Rs.2,87,99,169/-.

The Commissioner (A) allowed the assessee's appeal to the extent it related to disallowance of refund but no specific observation was made on the request for grant of interest.

Being aggrieved by the impugned order to the extent that it does not speak about interest on the refund that has been sanctioned, the assessee is before the CESTAT.

It is submitted that the issue involved is no more res integra. Reliance is placed on the decision in Rajalakshmi Textile Processor (P) Ltd. 2007-TIOL-788-HC-MAD-CX wherein the Madras High Court has held that the CENVAT credit is equal to payment of duty and hence refund of CENVAT credit as per Rule 5 of CCR is equivalent to refund of duty paid u/s 11B of the CEA, 1944 and, therefore, interest under Section 11BB of the CEA is admissible. Further, the Apex Court decision in Ranbaxy Laboratories Ltd. 2011-TIOL-105-SC-CX is relied upon wherein it is held that interest, in case of late disbursal of refund, is payable from the date of expiry of three months of refund application till refund is granted and not from the date of order of refund.

The Bench agreed with the submissions made by the appellant.

The appeal was allowed.

(See 2018-TIOL-1191-CESTAT-BANG)