MULJI NARSHI SHAH Vs. COMMISSIONER OF CUSTOMS

JUDGEMENT

(1.) This is an application for direction to refund the pre -deposit amount to the applicant with interest. By order dated 17 -4 -93 the Collector of Customs, Mumbai imposed a penalty of Rs. 1,00,000/ - on the applicant. The above order was successfully challenged by the appellant before this Tribunal. Under Final Order dated 6 -1 -2000 the Tribunal allowed this appeal. Pursuant to an interim order dated 24 -2 -94 passed by the Tribunal the applicant had deposited an amount of Rs. 40,000/ -. He, therefore, claimed refund of the above amount with interest vide letter dated 1 -11 -2000. Since no reply was received, it was followed by reminders dated 26 -12 -2000, 29 -10 -2001 and 10 -1 -2002. The present miscellaneous application was filed on 20 -2 -2003.

(2.) When the matter came up for hearing on 1 -5 -2003 it was submitted on behalf of the Revenue that the refund was granted on 10 -3 -2003 but without interest. The stand taken by the Revenue is that since it is refund of pre -deposit no interest is liable to be paid.

(3.) We do not find any merit in the contention raised by the Revenue. The issue has been settled by the Apex Court in its judgment in Kuil Fireworks Industries v. CCE - 1997 (95) E.L.T. 3 (S.C.) where it was held that refund of pre -deposit has to be made with 12% interest. Contention similar to the one raised by the Revenue before us was raised before the Kolkata High Court unsuccessfully as is evident from the judgment in Eastern Coils Pvt. Ltd. v. Commissioner of Central Excise, Calcutta - 2003 (153) E.L.T. 290. Under these circumstances we hold that the Revenue is liable to pay interest on the delayed refund of pre -deposit. For the purpose of the period as well as the rate of interest we adopt the principles contained under Section 27A. The appellant will be entitled to interest at the rate as prescribed under Section 27A for the period from the date of expiry of three months after the date of application for refund till the date of payment. The payment shall be made within one month from the date of receipt of this order.