Lupin LTD. Unit I vs. The Union Of INDIA

Held

The Court held that Section 6 of the 2020 Act, by its overriding nature, extended the time limit for actions under the Central Excise Act, including the processing of refunds. The Court found that the time limit prescribed in Section 11BB of the Central Excise Act for granting a refund was deemed extended to September 30, 2020, by Section 6 of the 2020 Act. Consequently, the refund order passed on September 30, 2020, was considered to be within the extended period. Therefore, the petitioner's claim for interest under Section 11BB for the delayed refund was rejected as untenable. Regarding the second claim for interest from October 9, 2015, to October 8, 2020, the Court noted that it was implicitly denied by the respondents, and the petitioner was informed to avail the remedy of appeal. The Court granted liberty to the petitioner to pursue this appeal as per law. The petition was dismissed with this liberty.

Facts

The petitioner, Lupin Ltd., filed an application for refund of excise duty on February 28, 2020, based on a Tribunal order dated February 14, 2019. The refund was sanctioned on September 30, 2020. As the refund was processed beyond three months from the application date, the petitioner claimed interest under Section 11BB of the Central Excise Act, 1944. The respondents-Revenue contended that Section 6 of the Taxation and Other Laws (Relaxation and Amendment of Certain Provisions) Act, 2020, extended the time limits for compliance and discharge of duties under the Excise Act until September 30, 2020, thereby validating the refund order passed on that date and negating the interest claim. The petitioner also raised a separate claim for interest for the period October 9, 2015, to October 8, 2020, which was implicitly denied.

Key Issues

1. Whether the claim for interest on delayed refund under Section 11BB of the Central Excise Act, 1944, can be denied in light of Section 6 of the Taxation and Other Laws (Relaxation and Amendment of Certain Provisions) Act, 2020, when the refund was made beyond three months from the application date? Petitioner's contention: The petitioner argued that Section 11BB of the Central Excise Act mandates interest payment if a refund is not processed within three months of the application. They relied on the plain language of Section 11BB and the fact that the refund was indeed delayed beyond this period. Revenue's contention: The Revenue contended that Section 6 of the 2020 Act, with its overriding effect, extended all prescribed time limits under the Excise Act, including the three-month period for refund processing, to September 30, 2020. Therefore, the refund sanctioned on September 30, 2020, was within the extended period, and no interest was payable under Section 11BB. 2. Whether the petitioner is entitled to interest for the period from October 9, 2015, to October 8, 2020, based on Annexure P/3?