Order Date – 19 January 2023

SPAN KATHWADA COMMERCIAL CO OPERATIVE SOCIETY LTD  Vs C.C.E.-AHMEDABAD-I 

Facts –

• The appellant, M/s Span Kathwada Commercial Co Operative Society Ltd, submits that even though the SCN was issued for recovery of Service tax amount of Rs.26,40,668/-, but during the intervening period, the Department has retained an amount of Service Tax of Rs. 9 Lakhs.
• It was contended that the appellant was not required to pay any amount, the said amount of refund is eligible for interest from the date of deposit till the date of sanction of the refund. 

Issue –

• Whether the appellant is entitled for interest on the refund of pre-deposit of Rs. 9 Lakhs.

Order –

• The Tribunal find that there is no dispute that the department has collected Rs. 9 Lakhs even though the adjudication process was undergoing. The amount of demand can be recovered only after the same is determined by completing the adjudication process, therefore, before the adjudication process, the amount of tax cannot be recovered.
• This amount of Rs. 9 Lakhs at the most can be considered as pre deposit and in case of pre deposit, the assessee is eligible for interest from the date of deposit.
• The appeal is allowed.