2009 (8) TMI 1005 - AT - Central Excise

Summary

Issues: Liability of interest on confirmed duty on samples for the extended period from 1997 to 2001 and from 2001 to 2002, and interests payable under Section 11AB of the Act.

The judgment pertains to an appeal listed before the Appellate Tribunal CESTAT Bangalore following a decision by the Hon'ble High Court of Karnataka in an appeal filed by the Revenue against the Tribunal's Final Order. The Counsel for the appellant referred to the judgment of the High Court in Central Excise Appeal No. 105/2006, where it was partly accepted in terms of an earlier order. The High Court had remitted the matter back to the tribunal for consideration of interest only for the delayed period. The appellant contended that interest should not be payable on the duty amount due to the Revenue on the samples, as the freight charges allowed by the Tribunal were not challenged by the Revenue. The submission was based on the decision in the case of Union Air Products (P) Ltd. v. CCE Kochi. On the other hand, the SDR submitted that the issue revolved around the confirmation of duty demand on samples for the extended periods and the interests payable under Section 11AB of the Act.

The crux of the issue was the liability of interest on the confirmed duty on samples cleared by the appellants without discharging the duty liability for the periods from 1997 to 2001 and from 2001 to 2002. The lower authority had confirmed the duty demand, which was upheld by the Tribunal in Final Order Nos. 803 & 804/2006. As the appellants did not appeal against this final order, it attained finality. The Tribunal found that the provisions of Section 11AB were directly applicable in this case. Consequently, the appeal was disposed of by holding that the appellant was liable to pay interest on the duty amount not paid on the samples from the date of clearance until the duty liability was discharged.

In conclusion, the Tribunal ruled that the appellant was indeed liable to pay interest on the duty amount not paid on the samples as confirmed by the Tribunal, from the date of clearance until the duty liability was discharged. The appeal was disposed of accordingly, in line with the above decision and findings.