Custom, Excise & Service Tax Tribunal
M/S Heg Limited vs Cce, Bhopal on 28 July, 2016
CUSTOMS, EXCISE & SERVICE TAX APPELLATE TRIBUNAL
NEW DELHI
PRINCIPAL BENCH - COURT NO. IV
Service Tax Appeal No. 18 of 2010
(Arising out of order-in-appeal No. 181/BPL/2009 dated 20.04.2009 passed by the Commissioner (Appeals) Customs, Central Excise & Service Tax, Bhopal)
DATE OF HEARING : 28.07.2016
DATE OF DECISION : 28.07.2016
FOR APPROVAL AND SIGNATURE :
HONBLE SMT. ARCHANA WADHWA, MEMBER (JUDICIAL)
HONBLE SHRI V. PADMANABHAN, MEMBER (TECHNICAL)
1.
Whether Press Reporters may be allowed to see the order for publication as per Rule 27 of the CESTAT (Procedure) Rules, 1982 ?
2.
Whether it should be released under Rule 27 of the CESTAT (Procedure) Rules, 1982 for publication in any authoritative report or not ?
3.
Whether their Lordships wish to see the fair copy of the Order ?
4.
Whether Order is to be circulated to the Departmental Authorities?
M/s HEG Limited . Appellant
(Rep by Sh. Rachit Jain, Adv.)
VERSUS
CCE, Bhopal . Respondent
(Rep. by Sh. Ranjan Khanna, DR) CORAM : HONBLE SMT. ARCHANA WADHWA, MEMBER (TECHNICAL) HONBLE SHRI V. PADMANABHAN, MEMBER (TECHNICAL) ORDER NO. 52917/2016 PER ARCHANA WADHWA, MEMBER (JUDICIAL) :
After hearing both sides, we find that the Appellant is engaged in the manufacture of Graphite Electrodes and their export, filed a refund of Rs. 7,15,037/- on 30.05.2008 in terms of Notification No. 41/2007 dated 06.10.2007. The said Notification allows refund of service tax paid on the various specified services utilized for export. They were issued a show cause notice on 07.07.2008 proposing to reject the refund claim on various grounds mentioned therein. The said show cause notice was adjudicated by the Assistant Commissioner vide his order dated 29.01.2009 vide which he allowed the refund claim of Rs. 6,47,280/-, but rejected the balance refund claim to the extent of Rs. 19,423/-. Being aggrieved with the said order, the Appellant filed an appeal before the Commissioner (Appeals), who vide his order dated 20.04.2009 sanctioned the balance refund of Rs. 19,423/- also.
2. Thereafter the Appellant approached the Revenue for refund of the balance amount. While claiming the sanctioned refund claim, they have also claimed the interest for the period after the expiry of three months from the date of original filing of the refund claim. Such interest claims stand denied by the lower authority on the ground that the refund amounts were given to the assessee before the expiry of three months from the date of passing of the respective orders. Hence, the present appeal.
3. The only issue required to be decided in the present appeal is, as to whether the Appellants claim for interest would start running from the expiry of period of three months from the original date of filing of refund claim or the same would start running from the expiry of period of three months from the date of passing the orders vide which the refunds were sanctioned. We find that the issue is no more res integra and stands decided by the Honble Supreme Court in the case of Ranbaxy Laboratories Ltd. Vs UOI, reported in 2012 (27) STR 193 (SC). By examining an identical issue, it has been held by the Honble Supreme Court as under :
9.?It is manifest from the afore-extracted provisions that Section 11BB of the Act comes into play only after an order for refund has been made under Section 11B of the Act. Section 11BB of the Act lays down that in case any duty paid is found refundable and if the duty is not refunded within a period of three months from the date of receipt of the application to be submitted under sub-section (1) of Section 11B of the Act, then the applicant shall be paid interest at such rate, as may be fixed by the Central Government, on expiry of a period of three months from the date of receipt of the application. The Explanation appearing below Proviso to Section 11BB introduces a deeming fiction that where the order for refund of duty is not made by the Assistant Commissioner of Central Excise or Deputy Commissioner of Central Excise but by an Appellate Authority or the Court, then for the purpose of this Section the order made by such higher Appellate Authority or by the Court shall be deemed to be an order made under sub-section (2) of Section 11B of the Act. It is clear that the Explanation has nothing to do with the postponement of the date from which interest becomes payable under Section 11BB of the Act. Manifestly, interest under Section 11BB of the Act becomes payable, if on an expiry of a period of three months from the date of receipt of the application for refund, the amount claimed is still not refunded. Thus, the only interpretation of Section 11BB that can be arrived at is that interest under the said Section becomes payable on the expiry of a period of three months from the date of receipt of the application under sub-section (1) of Section 11B of the Act and that the said Explanation does not have any bearing or connection with the date from which interest under Section 11BB of the Act becomes payable. As is seen from the above paragraph, the order of the Apex Court has held that the interest liability of the Revenue would start running from the expiry of period of three months from the date of filing of the original refund claim and the same is not depended upon the orders passed by the appellate authorities. The said order subsequently stands followed by the Honble Supreme Court in a recent decision in the case of Union of India vs Hamdard (Waqf) Laboratories, reported in 2016 333) ELT 193 (SC). Inasmuch as the issue stands decided by the above referred decisions of the Honble Supreme Court, we set aside the impugned order and allow the appeal with a direction to the lower authority to quantify the interest from the expiry of period of three months from the date of filing of the refund claim till the actual grant of the refund. The appeal is allowed in the above terms.
(Dictated & pronounced in the open court) (ARCHANA WADHWA) MEMBER (JUDICIAL) (V. PADMANABHAN) MEMBER (TECHNICAL) Golay 1