The Customs, Excise and Service Tax Appellate Tribunal (CESTAT), Chandigarh bench, while allowing an appeal filed by Gautam Industries, directed the excise department to pay 12% interest on the amount of deposit collected during the investigation period.
The appellants deposited some amount during investigation based on the intelligence information. Thereafter, show cause notices were issued to demand the duty by denying the benefit of SSI exemption notification and to impose penalty. The matter was adjudicated and the demand along with interest was confirmed. Penalty was also imposed. The said order was challenged before this Tribunal and this Tribunal set aside the adjudication proceedings. Consequent to that, the appellants filed refund claim of the amount deposited during the investigation. The same was refunded, but no interest was paid to the appellants. Therefore, the appellants are before me against the order of denial of interest from the date of deposit till the date of realization @12% p.a.
Before the Tribunal the appellants contended that the amount paid during the investigation is under protest, therefore, the interest is admissible on the said amount lying with the Department from the date of deposit till the date of refund.
Judicial Member Mr. Ashok Jindal observed that the case of Parle International Ltd (supra) are squarely covered the facts of this case as in the said case wherein the High Court has held that amount paid during the adjudication proceedings is to be regarded as deposit and not duty.
“Therefore, following the latest decision of this Tribunal in the case of M/s Jovex International (supra), I hold that the appellants are entitled for interest @12% p.a. from the date of deposit till the date of realization of refund of the amount paid during investigation,” the Tribunal said.Subscribe Taxscan AdFree to view the Judgment