ABDULLA GANI Vs. UNION OF INDIA

JUDGEMENT

(1.) Rule. Learned counsel for the Respondents waives service. By consent, the Rule is made returnable forthwith. The writ petition is taken up for hearing and final disposal, by consent and on the request of learned counsel.

(2.) The issue which falls for determination in this case is whether interest can in law be directed to be paid on a delayed refund of a predeposit made before the CESTAT during the pendency of an appeal, when the appeal results in the action of the Department being set aside.

(3.) The Petitioners were the Appellants before the Customs, Excise and Service Tax Appellate Tribunal against an order of adjudication passed on 25 February 2008 by the Commissioner of Customs, Mumbai imposing penalties of Rs.7.50 crores and Rs.50.00 lakhs respectively under Clauses (a) and (b) of Section 112 of the Customs Act, 1962. Initially, an order of adjudication had been passed in pursuance of a notice to show cause dated 9 May 1989. The order of adjudication dated 8 August 1989 had resulted in the imposition of penalties under Section 112 against which statutory appeals were filed before the then CEGAT, Mumbai. On 20 December 1990, in compliance with a direction of pre-deposit, the petitioners deposited amounts of Rs.20.00 lakhs and Rs.5.00 lakhs respectively. The Tribunal by its order dated 18 March 1989 remanded the proceedings back to the adjudicating authority upon which an order was passed on 25 February 2008, as noted above, imposing penalties of Rs.7.50 crores and Rs.50.00 lakhs respectively. The CESTAT by its judgment dated 29 May 2012 set aside the penalties imposed on the Petitioners. Before this Court it is not in dispute that the order of the CESTAT was accepted by the Revenue and no further challenge was made.