Commissioner of Customs (import) Vs. Universal Cables Limited

Commissioner of Customs (import) vs Universal Cables Limited

Type Court Judgment Court Customs Excise and Service Tax Appellate Tribunal CESTAT Mumbai Decided Sep 24, 2003

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Citation: sooperkanoon.com/32406
Court: Customs Excise and Service Tax Appellate Tribunal CESTAT Mumbai
Judge: J Balasundaram, A M Moheb
Decided On: Sep 24, 2003
Subject: Service Tax

Case Summary

AI-generated summary - not the official court judgment text.

Service Tax

Key legal issue: Service Tax

Parties & Advocates

Appellant / Petitioner

Commissioner of Customs (import)

Respondent

Universal Cables Limited

Excerpt

.....they succeeded in the appeal and therefore the amount paid under the directions of the tribunal was refunded to them. subsequently they filed a claim for interest of rs. 1,99,452/- on the refunded amount; which claim was rejected on the ground that section 27 of the customs act, 1962, under which the claim was lodged did not provide for payment of interest on refund of pre-deposit. the importers/respondents succeeded in their appeal before the commissioner (appeals) who held that the amount of rs. 35 lakhs was not a revenue deposit but duty and hence they were entitled to interest as a result of delay in grant of refund beyond the stipulated time period. hence this appeal by the revenue.3. the commissioner (appeals) has erred in holding that the amount of rs. 35 lakhs represents duty; as this amount is clearly in the nature of revenue deposit. however, the claim for interest is to be allowed in view of the tribunal's larger bench decision in the case of sheela foam pvt. ltd. v. cce, noida 2003 (154) elt 522 in which the plea was raised by the revenue that pre-deposit made cannot be treated as illegal recovery of money on account of statutory claim from the petitioners and therefore when such refund is made revenue cannot be compelled to pay interest, was rejected placing reliance upon the calcutta high court decision reported in 2003 (153) elt 290 (easter coils pvt. ltd. v. commissioner) and cbec circular dated 02/01/2002. we also find that interest has been awarded on refund of pre-deposit by the hon'ble bombay high court in the case of suvidhe ltd. v. union of india 1996 (82) elt 177 (bom) and the hon'ble madras high court as reported in 2001 (133) elt 2787 (mad) (cce, chennai v. calcutta chemical co. ltd.).the learned jt. cdr's plea before us that the issue as to whether interest is payable on delayed refund of pre-deposit may be placed for reconsideration before the larger bench, as there is no provision in the statute for grant of interest on such refund, is.....

Full Judgment

1. The respondents herein had paid a sum of Rs. 35 lakhs pursuant to interim order No. Misc/159/94-C. They succeeded in the appeal and therefore the amount paid under the directions of the Tribunal was refunded to them. Subsequently they filed a claim for interest of Rs. 1,99,452/- on the refunded amount; which claim was rejected on the ground that Section 27 of the Customs Act, 1962, under which the claim was lodged did not provide for payment of interest on refund of pre-deposit. The importers/respondents succeeded in their appeal before the Commissioner (Appeals) who held that the amount of Rs. 35 lakhs was not a revenue deposit but duty and hence they were entitled to interest as a result of delay in grant of refund beyond the stipulated time period. Hence this appeal by the Revenue.

3. The Commissioner (Appeals) has erred in holding that the amount of Rs. 35 lakhs represents duty; as this amount is clearly in the nature of revenue deposit. However, the claim for interest is to be allowed in view of the Tribunal's larger bench decision in the case of Sheela Foam Pvt. Ltd. v. CCE, Noida 2003 (154) ELT 522 in which the plea was raised by the Revenue that pre-deposit made cannot be treated as illegal recovery of money on account of statutory claim from the petitioners and therefore when such refund is made Revenue cannot be compelled to pay interest, was rejected placing reliance upon the Calcutta High Court decision reported in 2003 (153) ELT 290 (Easter Coils Pvt. Ltd. v. Commissioner) and CBEC circular dated 02/01/2002. We also find that interest has been awarded on refund of pre-deposit by the Hon'ble Bombay High Court in the case of Suvidhe Ltd. v. Union of India 1996 (82) ELT 177 (Bom) and the Hon'ble Madras High Court as reported in 2001 (133) ELT 2787 (Mad) (CCE, Chennai v. Calcutta Chemical Co. Ltd.).

The learned Jt. CDR's plea before us that the issue as to whether interest is payable on delayed refund of pre-deposit may be placed for reconsideration before the larger bench, as there is no provision in the statute for grant of interest on such refund, is rejected as all aspects have already been considered by the larger bench. Following the ratio thereof which is applicable on all (SIC) to the present case we hold that the respondents herein are entitled to the interest amount of Rs. 1,99,452/-.

Same Court & Year Customs Excise and Service Tax Appellate Tribunal CESTAT Mumb... Same Parties Commissioner of Customs (import) vs Universal Cables Limited Same Subject Service Tax Same Judge J Balasundaram, A M Moheb