Delay in Refund of CENVAT Credit of Customs Duty: CESTAT Orders Refund Along with 12% Interest from date of deposit till Realization [Read Order]

The New Delhi bench of the Customs, Excise and Service Tax Appellate Tribunal (CESTAT) allowed the refund claim along with the interest for delay in refund with 12% interest from the date of deposit till its realization. 

Shree Rajasthan Syntex Limited, the appellant assessee appealed against the order passed by the Commissioner for confirming the rejection of the claim of interest. 

Bipin Garg, the counsel for the assessee contended that the adjudicating authority deducted the interest amount despite protest made by the assessee from the rebate claims on export, and later on, as per the order of this Tribunal, the refund claim was sanctioned, and thus for the intervening period, the assessee was entitled to interest @12 per annum. 

Gopi Raman, the counsel for the department relied on the decisions made by the lower authorities and contended that the adjudicating authority had sanctioned the refund claim after the dispute ends within three months of filing the refund claim and thus the question of paying interest does not arise. 

The Bench observed that the assessee is entitled to claim interest from the date of payment of the initial amount till the date of its refund @ 12% per annum. 

Also observed that according to section 35FF of the Central Excise Act, 1944 where an amount deposited by the assessee in pursuance of an order passed by the Commissioner or the appellate tribunal was required to be refunded consequent upon the order of the appellate authority. 

A single-member bench comprising Ashok Jindal (Judicial) held that the assessee was entitled to get the interest on delay refund while allowing the appeal filed by the assessee. 

To Read the full text of the Order CLICK HERE

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