Writ petition allowing interest on delayed refund of education cess under Section 11BB of the Central Excise Act, 1944 based on precedent in Amalgamated Plantations and SRD Nutrients decisions.
Respondent No.2 to determine interest amount payable to the petitioner under Section 11BB and release it within three months.
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GAHC010001112019
THE GAUHATI HIGH COURT (HIGH COURT OF ASSAM, NAGALAND, MIZORAM AND ARUNACHAL PRADESH)
Case No. : WP(C) 59/2019
1:PAN PARAG INDIA LTD.
(FORMERLY KOTHARI PRODUCTS LIMITED) A COMPANY DULY INCORPORATED UNDER THE COMPANIES ACT, 1956 HAVING ITS REGD OFFICE AT PAN PARAG HOUSE, 24/19, THE MALL, KANPUR- 208001 HAVING ONE OF ITS UNIT AT A-1 TO A-4, INDUSTRIAL ESTATE, CINNAMARA, JORHAT- 785008
VERSUS
1:UNION OF INDIA AND ANR.
DULY REP BY THE SECRETARY TO THE MIN OF FINANCE, DEPTT OF BANKING AND REVENUE, NORTH BLOCK, NEW DELHI
2:THE ASSISTANT COMMISSIONER CENTRAL TAX CENTRAL GST DIVISION JORHAT STATION GODOWN ROAD JORHAT- 78500
Advocate for the Petitioner : MR. S K KEJRIWAL
Advocate for the Respondent : SC, EXCISE DEPTT.
BEFORE HONOURABLE MR. JUSTICE UJJAL BHUYAN
ORDER
Date : 07-03-2019
Heard Mr. S.K. Kejriwal, learned counsel for the petitioner and Mr. B. Sharma, learned Standing Counsel, Central Excise.
By filing this petition under Article 226 of the Constitution of India, petitioner seeks a direction to respondent No.2 to pay interest on the delayed refund of education cess including
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secondary and higher education cess. In other words, subject-matter of the writ petition is payment of interest on delayed excise duty refund by the Central Excise to the petitioner.
Petitioner is an industrial unit set up in the State of Assam and claims benefit of excise duty exemption under Central Government Notification dated 08.07.1999.
It may be mentioned that for the relevant period, i.e., July, 2004 to April, 2017, education cess including secondary and higher education cess were levied and realized from the petitioner along with excise duty.
Following the decision of the Supreme Court in M/s. SRD Nutrients Pvt. Ltd Vs. Commissioner, 2016 (338) ELT A 284 , CESTAT, Kolkata allowed the appeal of the petitioner by holding that since levy of excise duty was exempted on the petitioner in terms of the Central Government notification dated 08.07.1999, education cess including secondary and higher education cess which were nothing but components of the excise duty itself were liable to be refunded.
Thereafter, respondent No.2 passed the order dated 12.11.2018 refunding education cess including secondary and higher education cess.
In this petition, petitioner has claimed interest on the delayed refund.
Section 11B of the Central Excise Act, 1944 deals with claim for refund of duty. Under Section 11BB of the said Act, if any duty ordered to be refunded under Sub-Section (2) of Section 11B to any applicant is not refunded within three months from the date of receipt of the application under Sub-Section (1), these shall be paid to that applicant interest at such rate which may be fixed by the Central Board of Excise and Customs on such duty from the date immediately after the expiry of three months from the date of receipt of such application till the date of refund of such duty.
Learned counsel for the petitioner submits that issue raised in this writ petition is squarely covered by a Division Bench judgment of this Court in Amalgamated Plantations (P) Ltd Vs. Union of India , reported in 2013(2) GLR 732.
Mr. Sharma in his usual fairness submits that SLP filed by the Central Excise before the Supreme Court against the aforesaid decision was dismissed on the ground of limitation.
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Therefore, the question is still open.
In reply, Mr. Kejriwal submits that even if submission of Mr. Sharma is accepted, Division Bench judgment in Amalgamated Plantations (P) Ltd (supra) holds the field and is the law applicable at least in so far this High Court is concerned.
Submissions made have been considered.
Relevant portion of the order in Amalgamated Plantations (P) Ltd (supra) reads as under:-
“ 29.From a conjoint reading of sections 11B and 11BB of the Central Excise Act, 1944, it is apparent that if any refund of excise duty is ordered under section 11B(2), the same has to be refunded within three months from the date of receipt of application under sub section (1) of that section, failing which interest will have to be paid. Language of section 11B is very clear and unambiguous. It speaks of claiming refund of any (emphasis ours) duty of excise. No exception is provided. It does not distinguish or differentiate between any kind of excise duty refund, whether duty paid in excess or duty paid which are exempted. As pointed out by the Hon’ble Supreme Court in the case of Ranbaxy Laboratories Ltd. -Vs- Union of India reported in (2011) 10 SCC 292, it is a well-settled proposition of law that a fiscal legislation has to be construed strictly and one has to look merely at what is said in the relevant provision; there is nothing to be read in; nothing to be implied and there is no room for any intendment.
30.In the case of Ranbaxy Laboratories Limited (supra), Hon’ble Supreme Court while examining the aforesaid two provisions, referred to a circular dated 01-10-2002 issued by the Central Board of Excise and Customs, New Delhi wherein and whereby the Board stressed that the provisions of section 11BB of the Central Excise Act, 1944 are attracted automatically for any refund (emphasis ours) sanctioned beyond a period of three months. Hon’ble Supreme Court has held that liability of the Revenue to pay interest under section 11BB commences from the date of expiry of three months from the date of receipt of application for refund under section 11B(1) and not on the expiry of the said period from the date on which the order of refund is made.
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31.We also find that a Single Bench of this Court in (2004) 171 ELT458 (Hindustan Coca-Cola Beverages Pvt. Ltd. -Vs- Union of India) while directing refund of excise duty paid in terms of notification dated 08-071999, had also directed payment of interest for delayed payment as per provision of section 11 of the Central Excise Act, 1944.
32.Thus, in view of the discussions made above, we are of the unhesitant view that section 11B of the Central Excise Act, 1944 does not exclude claim of refund made in terms of the notification dated 08-07-1999. Petitioners would, therefore, be entitled to interest under section 11BB of the Central Excise Act, 1944 on the excise duty refunded to them. The jurisdictional excise officers shall now determine the interest amount payable to the petitioners for the relevant periods. The amounts found due shall be paid to the petitioners within three months from today.”
Accordingly and in the light of the above, it is held that petitioner would be entitled to interest under Section 11BB of the Central Excise Act, 1944 on the education cess including secondary and higher education cess refunded to it belatedly. Respondent No.2 shall now determine the interest amount payable to the petitioner for the relevant period whereafter the same shall be released to the petitioner within a period of 3 months from today.
Writ petition is disposed of.
JUDGE
Comparing Assistant
2 issues framed by the court
Whether the petitioner is entitled to interest under Section 11BB of the Central Excise Act, 1944 on delayed refund of education cess.
Whether Section 11BB of the Central Excise Act applies to cess levied along with exempted excise duty.
Colour shows how this judgement treated each authority
M/s. SRD Nutrients Pvt. Ltd Vs. CommissionerReferred¶22
(2016) 338 ELT A 284
Amalgamated Plantations (P) Ltd Vs. Union of IndiaFollowed¶26
2013(2) GLR 732
Ranbaxy Laboratories Ltd. -Vs- Union of IndiaReferred¶33
(2011) 10 SCC 292 · Who else cites this
Hindustan Coca-Cola Beverages Pvt. Ltd. -Vs- Union of IndiaReferred¶36
(2004) 171 ELT 458
2 provisions across 1 enactments
PAN PARAG INDIA LTD.
UNION OF INDIA
THE ASSISTANT COMMISSIONER CENTRAL TAX CENTRAL GST DIVISION JORHAT
Ujjal Bhuyan
As recorded by the court registry
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