Tribunal can initiate contempt proceedings against the Department in case of failure to sanction refund long pending to the Assessee consequent to favourable Tribunal order
LCL Logistics (India) Pvt. Ltd. (the Appellant) filed a Miscellaneous Application before the Hon’ble CESTAT, Mumbai, in respect of Order of the Hon’ble Tribunal vide which the penalty on the Appellant was reduced from Rs. 5,00,000/- to Rs. 1,00,000/-. The Appellant contended that more than three years have passed and the Department has not refunded balance amount of Rs. 4,00,000/- despite of many letters dated August 23, 2011, November 7, 2011, January 25, 2012, June 18, 2012 and March 13, 2013 addressed to the Department. It was further submitted that no reply has been received from the Department’s side in response to the stated letters, which was even admitted by the Department.
The Appellant further submitted that under Rules 40 and 41 of the CESTAT (Procedure) Rules, 1982, the Hon’ble Tribunal can invoke its authority to give effect to the Order of the Tribunal passed on August 1, 2011.
The Hon’ble CESTAT, Mumbai while deciding the Miscellaneous Application, held that it is most unfortunate that the Department has not even cared to reply to any letter of the Appellant seeking refund consequent to the Order of this Tribunal and accordingly, ordered the Department to sanction the refund within 45 days of the receipt of this Order.
It was further held by the Hon’ble Tribunal that in case of any further failure on part of the Department, the Tribunal may have to consider contempt proceedings against the Sanctioning Authority.