Manisha Pharmo Plast Pvt. Ltd. Vs Union of India (Supreme Court of India)
Material Facts
The appellant sought statutory interest under Section 11BB of the Central Excise Act, 1944, read with Circular No. 670/61/2002-CX.8 dated 01.10.2002, on a refund claim. The refund application was filed on 30.12.1999, and the Department paid the refund amount on 26.06.2005.
Procedural History
The High Court denied the appellant’s claim for statutory interest. It held that the adjudication of the refund claim attained finality only after dismissal of proceedings before the High Court on 18.07.2005 and noted that the refund amount had already been paid on 26.06.2005. These facts were undisputed before the Supreme Court.
Legal Issue
Whether statutory interest under Section 11BB of the Central Excise Act, 1944 was payable from three months after the date of the refund application or only after the refund claim attained finality.
Relevant Statutory Provisions
- Section 11BB of the Central Excise Act, 1944
- Circular No. 670/61/2002-CX.8 dated 01.10.2002
Court’s Findings and Reasoning
The Supreme Court referred to paragraph 17 of Ranbaxy Laboratories Ltd. vs. Union of India & Ors. [(2011) 10 SCC 292] and held that the issue stood concluded by that decision. The Court noted the approval therein of the view that, for the purposes of Section 11BB, the relevant date for determining liability to pay interest is the date of the refund application, and liability to pay interest commences if the refund is not paid within three months from that date, irrespective of when the competent authority finally decides the refund claim.
