Public Notice: 41/2002
Import supply No.
Export supply No.
PUBLIC NOTICE NO.41/2002 Date : 22.03.2002

Sub: Return of deposits made in terms of Section 35 F of the Central Excise Act, 1944 and Section 129 E of the Customs Act, 1962- reg.
The practice in the department relating to refund of Pre-deposit made during pendency of appeal, had all along been to consider such deposits as other than duty, such deposits are to be returned in the event the appellant succeeds in appeal or the matter is remanded for fresh adjudication.

2. The Revenue had recently filed a Special Leave Petition against Mumbai High Court’s order in the matter of NELCO Ltd. challenging the grant of interest on delayed refund of pre-deposit as to whether :

(i) the High Court is right in granting interest to the depositor since the law contained in Section 35 F of the Act does in no way provide for any type of compensation in the event of an appellant finally succeeding in the appeal. And,

(ii) the refunds so claimed are covered under the provisions of Section 11 B of the Act and are governed by the parameters applicable to the claim of refund of duty as the amount is deposited under Section 35F of the Central Excise Act, 1944.

The Hon’ble Supreme Court vide its order dated 26.11.2001 dismissed the appeal. Even though the Apex Court did not spell out the reasons for dismissal, it can well be construed in the light of its earlier judgement in the case of Suvidhe Ltd. and Mahavir Aluminum that the law relating to refund of pre-deposit has become final.

3. In order to attain uniformity and to regulate such refunds, it is clarified that refund applications under section 11B(1) of the Central Excise Act, 1944 or under Section 27 (1) of the Customs Act, 1962 need not be insisted upon. A simple letter from the person who has made such deposit, requesting the return of the amount, along with an attested the payment of the amount of such deposit, addressed to the concerned Assistant/Deputy Commissioner of Central Excise or Customs, as the case may be, will suffice for the purpose. All pending refund applications already made under the relevant provisions of the Indirect Tax Enactments for return of such deposits and which are pending with the authorities will also be treated as simple letters asking for return of the deposits and will be processed as such. Similarly, bank guarantees executed in lieu of cash deposits shall also be returned.

4. All claims of return of pre-deposits made during the pendency of Appeals, are to be settled in the light of above where Order-in-Appeal orders consequent relief.

(C.SEN)
COMMISSIONER OF CUSTOMS(EP)
NEW CUSTOMS HOUSE, MUMBAI.

Copy to:
All Dy. /Asstt. Commissioner of Customs, under Commissioner of Customs (EP).

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