2020 (2) TMI 605 - AT - Central Excise

Demand of Interest - whether the Commissioner (Appeal) was justified in demanding interest along with the duty as determined by the Adjudicating authority? - HELD THAT - The matter went upto the Hon ble Supreme Court for the demand of duty in respect of the earlier period where the Hon ble Supreme Court decided the case on merit in favour of the Revenue and set aside the penalties. Section 11AB deals with interest on delayed payment of duty. Sub Section (1) of Section 11AB provides that where any duty of excise has not been levied or paid etc. the person who is liable to pay the duty as determined under Sub-Section (2) or has paid the duty under sub Section (2) of Section 11A shall in addition to the duty, be liable to pay interest. The expressions shall, in addition to the duty, be liable to pay interest in Section 11AB(i) of the Act, 1944 as it stood during the relevant period make it clear that the liability to pay interest is linked with the delayed payment of duty as determined under Section 11A of the Act, 1944. The Commissioner (Appeals) proceeded on the basis of Section 11A(14) of the Act, 1944 which was not introduced, during the material period, but the Order of the Commissioner (Appeals) is required to be upheld, after analyzing Section 11AB of the Act 1944 as it stood during the relevant period. There are no reason to interfere the order of the Commissioner (Appeals) - appeal dismissed - decided against appellant.

Summary

Issues:
Demand of interest along with duty determined by Adjudicating authority.

Analysis:

Issue 1: Demand of interest along with duty determined by Adjudicating authority

The appeal was filed against an Order-in-Appeal where the Revenue's appeal was upheld, stating that no separate order is needed for the payment of interest along with the determined duty. The case involved the manufacture of Steel Items and the claim of SSI exemption. Show Cause Notices were issued for denying the exemption due to brand name usage. The Tribunal previously set aside the adjudication order, which was later partially restored by the Supreme Court. The Adjudicating authority confirmed the demand of Central Excise duty and interest, leading to the current appeal. The appellant contested the demand of interest, citing the Hon'ble Supreme Court's judgment and the prospective effect of relevant sections. The Commissioner (Appeals) upheld the demand of interest, stating that interest is statutorily required to be paid along with the determined duty. The Commissioner (Appeals) relied on Section 11A(14) and concluded that no separate order for interest is necessary. The appellant's argument regarding the absence of a specific direction from the Supreme Court on interest was dismissed, as the appeal only focused on penalties. The Commissioner (Appeals) decision was supported by the analysis of Section 11AB of the Act during the relevant period. The appellant's cross objection was considered against the Revenue's appeal, and the Commissioner (Appeals) ruled in favor of the Revenue. Ultimately, the appeal was rejected, and the Commissioner (Appeals) order was upheld.

This detailed analysis of the judgment highlights the legal complexities involved in the demand for interest along with the determined duty and the Commissioner (Appeals) decision based on statutory provisions and previous judicial interpretations.