Customs, Excise and Service Tax Appellate Tribunal

Load Controls India Pvt. Ltd. Vs. Commissioner of Central Tax, Bangalore South Commissionerate

MANU/CB/0240/2019

18.11.2019

Excise

If amount is not voluntarily paid by assessee and later on case is decided in his favour, then he is entitled to interest from date of deposits made by assessee

The present appeal is directed against the impugned order passed by the Commissioner (Appeals) whereby the Commissioner (Appeals) has allowed the interest to the Appellant after the expiry of three months from the date of receipt of application under Section 11B (1) of the Central Excise Act, 1944.

Learned counsel for the Appellant submitted that, the impugned order is not sustainable in law as the same has been passed without properly appreciating the facts and the law. He further submitted that, the Appellant is entitled to interest on the refund as the amounts paid by the appellant are not voluntary and is on account of recovery proceedings initiated by the Department during the operation of Stay Order. He further submitted that, the Apex Court has categorically held that the taxes which are collected either in excess or without authority of law, then the Revenue must compensate the assessee with interest even in the absence of statutory provision.

In the present case, the amount was recovered by the Department from the Appellant in spite of the extension of Stay Order issued by CESTAT which was subsequently extended also. The Department in fact compelled the Appellant to reverse the credit in spite of stay in his favour though the Appellant informed the Department that they have got the extension of stay but they could not produce the copy of the stay in time and therefore the Department coerced the Appellant to reverse the credit. Further, in the present case, the deposit made by the Appellant was totally unauthorized because the CESTAT has given him complete waiver. Further, it has been consistently held by the Tribunal that, if the amount is not voluntarily paid by the assessee and later on the case is decided in favour of the assessee, then he is entitled to interest from the date of deposit made by the assessee.

Further, in view of the decisions relied upon by the appellant wherein it has been held that, the assessee is entitled to interest from the date of deposit till the date of refund. By following the ratio of the above said decisions, Present Tribunal is of opinion that the impugned order is not sustainable in law and therefore the same is set aside by allowing the appeal of the Appellant.

Tags : Interest Entitlement Date

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