2003 (6) TMI 75 - AT - Central Excise

Summary

Issues: Levy of interest under Section 11AB of the Central Excise Act, 1944

In this case, the issue revolves around the levy of interest under Section 11AB of the Central Excise Act, 1944. The appellant contested the imposition of interest, arguing that there was no intention to evade payment of duty as they had a considerable balance in the Modvat account. The appellant highlighted that they had voluntarily reversed the availed credit, emphasizing that since the penalty under Section 11AC was dropped by the Commissioner, interest under Section 11AB should also be set aside. The appellant relied on the similarity in wordings between Section 11AB and Section 11AC to support their argument. Additionally, the appellant referred to precedents where the levy of interest under Section 11AB was set aside in similar cases. The Revenue, represented by JDR, defended the imposition of interest. After considering the arguments and relevant legal provisions, the tribunal found no justification to levy interest under Section 11AB due to the similarity in wordings with Section 11AC. Citing previous decisions and the specific circumstances of the case, the tribunal allowed the appeal, ruling in favor of the appellant.

This judgment highlights the interpretation and application of Sections 11AB and 11AC of the Central Excise Act, 1944 concerning the levy of interest and penalty for duty evasion. It underscores the importance of intent in determining the applicability of interest under Section 11AB, especially in cases involving Modvat accounts. The tribunal's decision emphasizes the need for consistency in applying statutory provisions and considering precedents to ensure fair and just outcomes in excise duty matters.