2004 (12) TMI 510 - AT - Central Excise

Summary

Issues:
1. Whether interest is payable on the differential duty due from the appellants for the period from April 1999 to March 2000 even though the duty was paid after 1-4-2000 in terms of Rule 173G(1)(d).

Analysis:
The appeal was against OIA No. 73/2003-C.E., dated 21-7-2003 passed by the Commissioner of Central Excise (Appeals) II Bangalore. The main contention was regarding the retrospective application of interest clause 173G(1)(d) introduced from 1-4-2000. The Commissioner (Appeals) held that interest starts accruing from the date of introduction of the interest clause on the outstanding amount till the date of actual payment. The appellant argued against retrospective charging of interest on amounts due before 1-4-2000, citing case laws and Board Circular 655/46/2002-C.E.

The advocate for the appellant argued that interest should only be paid for the period from April 2000 to December 2000, not the full amount demanded. They relied on the Board Circular and case law precedent to support their position. The advocate emphasized that interest on delayed payment of duty cannot be imposed for periods before the provision's incorporation, as established in previous legal decisions. The Supreme Court's ruling in Mithilesh Kumari v. Prem Behari Khare was cited to emphasize the presumption against retrospective application of statutes.

The Tribunal analyzed the situation, noting that the interest clause 173G(1)(d) was effective only from 1st April 2000. Since the provisions for due dates were introduced from this date, they could not be applied to clearances before 1-4-2000. The Tribunal found the arguments and precedents cited by the appellant and the Board's clarification regarding Section 11AB to be directly relevant to the case. Consequently, the appeal was allowed with consequential relief granted to the appellant.