(1) Where the refund is due to the dealer or any other person on account of tax or penalty found to have been paid in excess in pursuance of an order under section 11 Section 11-A or 12 the Government shall pay to such a dealer/person simple interest at 18% per annum on the amount of such refund from the date such amount was paid to the date on which refund is granted;

Provided where the amount found to be in excess was paid in instalments such interest shall be payable on the amount of such instalment which was in excess from the date on which such instalment was paid to the date on which the refund is granted.

Provided further that interest for the period commencing from the date of the order under section 11, section 11-A or section 12 giving rise to the refund shall be paid at the rate of 24% per annum.

(2) Where the refund is withheld under the provisions of section 10-A, the Government shall pay simple interest at the rate of 18% per annum on the amount of refund ultimately determined to be due as a result of appeal of further proceeding;

Provided that interest for the period commencing from the date on which the time determined by the Commissioner under section 10-A expires shall be paid at the rate of 24% per annum.

Explanation I - Interest for a part of the month shall be allowed proportionately.

Explanation II - In case the payment of tax has been made by a cheque or draft or in any other mode otherwise than in cash, the date of payment will be the date on which such cheque, draft, etc. was actually encashed.