Order Date – 09 February 2023

Parties: Interscape Mumbai Vs Commissioner of CGST & CX, Belapur

Facts –

• The Appellant, Interscape Mumbai, had filed refund claim for the amount of Rs. 24,15,437/- on 26.10.2018 which was deposited on behalf of the Appellant by their customer M/s. Omsagar Engg Pvt. Ltd. under protest during an investigation in the year 1995.
• The Authority concerned sanctioned the refund amount of Rs. 23,15,437/- in terms of Section 11B of Central Excise Act, 1944 on 08.02.2019 and no interest was sanctioned.

Issue –

• Whether the appellant is entitled for interest on refund which was deposited during an investigation in the year 1995?

Order –

• The Tribunal held that the amount paid during the investigation shall be considered as payment of duty. And the refund of the duty amount is clearly governed by section 11B ibid and the interest is available under section 11BB and the interest is payable after completion of three months from the date of filing of refund application.
• Liability for payment of interest after the expiry of three months is statutory and therefore it was a bounden duty of the authority concerned to pay interest after the expiry of the aforesaid period at the rate as specified under section 11BB ibid.
• Thus, the appellant is entitled for the interest on refund after the expiry of three months from the date of application till the date the payment of refund has been made.