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2026 Supreme(Online)(Gau) 12197
THE GAUHATI HIGH COURT (HIGH COURT OF ASSAM, NAGALAND, MIZORAM AND ARUNACHAL PRADESH)
Michael Zothankhuma, Sanjeev Kumar Sharma, JJ
COMMISSIONER OF CGST AND EXCISE – Appellant
Versus
M/S BRAHMAPUTRA CRACKER AND POLYMER LIMITED – Respondent
C.Ex.App./3/2026
For the Appellants/Petitioners: Subhash Chandra Keyal
For the Respondents: appearing for Brahmaputra Cracker and Polymer Limited
The court is examining whether a statutory notification fixing the interest rate at 6% under Section 35FF of the Central Excise Act, 1944, overrides a higher interest rate awarded by a Tribunal for refunded service tax.
Headnote:The case involves the interpretation of Section 35FF of the Central Excise Act, 1944, and Notification No. 24/2014-CE(N.T.) dated 12-08-2014. The appellant contends that the Central Government, exercising powers under the said section, fixed the interest rate at 6% per annum for refunded service tax, whereas the Tribunal had awarded a higher interest rate in the impugned final order No. 75765/2014. The primary issue is whether the Tribunal was legally correct in awarding 12% interest per annum on a portion of the refund when the applicable notification under Section 35FF of the Central Excise Act, 1944, specifies a rate of 6% per annum. In the interim, the impugned final order No. 75765/2014 shall remain stayed to the extent that instead of 12%, the interest @ 6% should be paid on the return service tax to the respondent.
| Table of Content |
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| 1. submission that statutory notifications under section 35ff fix the interest rate for refunds. (Para 1 , 2 , 3 , 4) |
| 2. determining the legality of the tribunal's interest rate award against statutory notifications. (Para 5) |
| 3. granting interim stay on the interest rate pending further hearing. (Para 6 , 7 , 8 , 9) |
ORDER
(M. Zothankhuma, J)
Heard Mr. S. C. Keyal, learned Senior Standing Counsel, CGST.
2. The learned senior counsel submits that in terms of the Notification No.24/2014 -CE(N.T.) dated 12-8-2014, issued by the Government of India, Ministry of Finance (Department of Revenue), the Central Government in exercise of the powers conferred under Section 35FF of the Central Excise Act, 1944 has fixed the rate of interest at 6% per annum, for the purpose of Section 35FF .
3. Section 35FF pertains to the interest to be paid on the refunded service tax of the respondent, pursuant to the impugned final order No. 75765/2014, wherein the learned Tribunal awarded interest @ 7% per annum.
4. The learned senior counsel submits that the interest payable by the appellant should be 6% and not 12%, in terms of the Notification dated 12-8-2014.
5. The substantial question of law that has been framed is..
“Whether The Tribunal was legally correct in holding that the Respondent is entitled to 12% interest per annum on 7.5% of Rs. 7,90,08,905/- from 28.12.2018 till 01.09.2022 whereas Notification No. 24/2014-CE(N.T.) dated 12.08.2014 has fixed the rate of interest at 6% per annum under section 35FF of Central Excise Act, 1944?”
6. Issue notice, returnable in 6 (six) weeks.
7. The appellant to take step for service of notice upon the respondent by speed post as well as by usual mode within three days.
8. In the interim, the impugned final order No. 75765/2014 shall remain stayed to the extent that instead of 12%, the interest @ 6% should be paid on the return service tax to the respondent.
9. List this matter on 23.06.2026
