2017 (10) TMI 1320 - AT - Central Excise

Interest on Differential Duty demanded - whether Interest is payable when differential duty is paid before passing final assessment? - Held that - The issue is no more res integra inasmuch as this Tribunal in the appellant s own case CCE (ST) LTU, CHENNAI VERSUS M/S. TUBE PRODUCTS OF INDIA 2016 (3) TMI 133 - CESTAT CHENNAI has held that From the reading of the Rule 7 (4) of CENTRAL EXCISE RULES, 2002 it is seen that interest is payable only when any amount is payable consequent to the order for final assessment. When no amount is to be paid consequent to the order of final assessment, sub-rule 4 is not attracted at all - the appellants are not liable to pay interest - appeal allowed - decided in favor of appellant.

Summary

Issues:
1. Provisional assessment and demand of interest for differential excise duty.

Analysis:
The case involved the appellant, a manufacturer of strips and tubes, who faced challenges due to fluctuating raw material prices, leading to difficulty in valuing goods cleared to sister units for captive consumption. The appellant sought provisional assessment for three units and voluntarily discharged differential excise duty when finalizing the assessment. However, the department insisted on demanding interest for the differential excise duty until the actual payment date. The adjudicating authority and the Commissioner (Appeals) upheld the interest demand, prompting the appeals.

The appellant's counsel argued that a previous Tribunal order in the appellant's favor, citing a judgment from the Bombay High Court affirmed by the Apex Court, established that interest is not payable if differential duty is paid before the final assessment. The Assistant Commissioner reiterated the findings of the impugned order during the proceedings.

After considering both arguments and examining the records, the Member (Judicial) noted that the issue had been settled in the appellant's favor in a previous case decided by the Tribunal. Relying on this precedent, the Member ruled that the appellants were not obligated to pay interest. Consequently, the impugned order demanding interest was set aside, and the appeals were allowed with any necessary consequential relief.

The judgment highlights the importance of legal precedents and the application of established principles in resolving disputes related to provisional assessment and the payment of interest for differential excise duty. The decision underscores the significance of consistency in judicial interpretation and the binding nature of prior rulings, ensuring fairness and predictability in tax matters.