In a major relief to Blackberry India Pvt Ltd, the Delhi High Court directed to process claim of interest under Section 11BB of the Excise Act.
The petitioner (Blackberry India Pvt. Ltd.) has filed the present petition impugning an order passed by the Adjudicating Authority to the extent that it denies the petitioner’s claim for interest under Section 11BB of the Central Excise Act, 1944 read with Section 83 of the Finance Act, 1994, on the amount of refund sanctioned.
The Adjudicating Authority has sanctioned the refund of unutilised Cenvat Credit as claimed by the petitioner, but has denied the interest on the said amount, on the ground that the refund has been sanctioned within a period of three months, as contemplated under Section 11BB of the Excise Act read with Section 83 of the Finance Act.
The claims were not processed and the Adjudicating Authority issued a Show Cause Notice, proposing to reject the petitioner’s claim for refund on the ground that the place of provision of services was in India. According to the Adjudicating Authority, the petitioner had rendered the services in question as an intermediary.
A Division Bench of Justices Vibhu Bakhru and Amit Mahajan observed that “The Adjudicating Authority has correctly proceeded on the basis that the interest under Section 11BB of the Excise Act would be payable from the date immediately after the expiry of three months from the date of application for refund, if the same is not processed within the said period of three months. He has, however, erred in holding that the petitioner’s letter, requesting for processing its claims for refund is to be considered as its application for refund.”
The Bench further went on to note that the impugned order is, ex facie, erroneous to the extent it rejects the petitioner’s claim for interest. The impugned order sets out a tabular statement as reproduced hereinbefore, clearly stating the dates on which the petitioner had made its claim for refund. There is no cavil that the petitioner would be entitled to the interest in terms of Section 11BB of the Excise Act from the date immediately after the expiry of three months from the date of receipt of an application for refund.
“In view of the above, the Adjudicating Authority is directed to forthwith process the petitioner’s claim of interest under Section 11BB of the Excise Act read with Section 83 of the Finance Act” the Court concluded.
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