Churchit International Vs Commissioner of Customs (Export) (CESTAT Delhi)
CESTAT Delhi held that interest is payable on amount deposited during the course of investigation and refunded back due to NIL. Interest is payable at the rate of 12% from the date of deposit till the date of refund.
Facts- The issue pertains to refund of amount of interest paid on the amount collected during course of investigation which was paid much before issuance of Show cause Notice. The principle amount was ultimately refunded since no demand was ever confirmed against the appellant. However, the issue of refund of amount of interest was left open to be decided by refund sanctioning authority.
Conclusion- In case of Commr. of CGST, New Delhi Vs. Emmar Mgf Construction Pvt. Ltd. it was held that amount deposited during investigation and/or pending litigation is ipso facto pre-deposit and interest is payable on such amount to the assessee being successful in appeal, from the date of deposit till the date of refund.
Held that the payment made by the appellant at the time of investigation, in absence of any SCN for the same, cannot be held to be the payment against the demand raised by the Department without even going into the merits of the nature of demand. Though no notification, if any, is brought to notice by the department, irrespective, in view of the decisions of Hon’ble Supreme Court and others as discussed above, I hold that the appellant is eligible for refund of interest at the rate of 12%.
