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2015 (11) TMI 376 - SC - CustomsValidity of order of High Court - Demand of interest - Delayed payment of duty - Date of applicable interest - Held that - Section 28AA, inter alia, provided that where a person chargeable with duty determined under sub-Section (2) of Section 28 fails to pay such duty within three months from the date of determination, he shall pay, in addition to the duty, interest as well as per the rate specified therein. - effect of the aforesaid provision was to charge interest after the expiry of three months from the date when this provision came into force. The President has given assent to the aforesaid amendment on 26.05.1995. Insofar as the appellant is concerned, in his case, duty had already been determined prior to coming into force of this amendment inasmuch as Order-in-Original confirming the duty was passed on 28.01.1994 - when the appellant as well as its counsel knew that the issue as to whether the interest is payable or not on other grounds had already been foreclosed in the earlier writ petition, the counsel for the appellant did not make any submission with regard to the plea raising the issue in Show Cause Notice and limited his prayer from the date from which the interest was to be paid. - when this issue was raised and abandoned in the first writ petition which was dismissed as withdrawn, the principles of constructive res-judicata which is laid down under Order 23 Rule 1 of the Code of Civil Procedure, 1908, and which principles are extendable to writ proceedings as well as held by this Court in Sarguja Transport Service v. State Transport Appellate Tribunal, M.P., Gwalior and Others 1986 (11) TMI 377 - SUPREME COURT would squarely be applicable. - Decided against assessee.
Issues:
1. Challenge to the validity of orders dated 28.03.2006 passed by the High Court of Bombay in Writ petition No. 338 of 2006 regarding the demand of interest raised by the respondent-Department on the amount of duty paid belatedly. 2. Dispute about the payment of excise duty by the appellant leading to the demand of interest on the delayed payment. 3. Interpretation of Section 28AA of the Customs Act, 1962 regarding the payment of interest on delayed duty payment. 4. The argument raised by the appellant regarding the demand of interest without serving a Show Cause Notice. Analysis: 1. The appellant challenged the validity of the High Court's orders regarding the demand of interest on belated duty payment. The dispute arose when the appellant requested installment payments due to financial constraints after a demand of duty and penalty. The Department later demanded interest on the delayed payment, leading to a legal battle. The High Court partially ruled in favor of the appellant, recalculating the interest owed. 2. The dispute stemmed from a Show Cause Notice issued to the appellant regarding excise duty payment. Despite initial rulings in favor of the appellant by the Customs, Excise, and Gold Appellate Tribunal, the Supreme Court eventually confirmed the duty demand. The appellant then faced a demand for interest on the belated payment, leading to the legal challenge. 3. The interpretation of Section 28AA of the Customs Act, 1962 was crucial in determining the interest payable on delayed duty payment. The section stipulated that interest is payable if duty is not paid within three months of determination. The appellant contested the interest calculation, leading to a re-calculation by the Department. The appellant objected to the revised interest amount, leading to further legal proceedings. 4. The appellant raised an argument regarding the demand of interest without serving a Show Cause Notice. The appellant's counsel contended that interest could not be levied without prior notice. However, this argument was not raised before the High Court. The Supreme Court rejected the appellant's attempt to introduce this argument at a later stage, citing principles of constructive res-judicata from previous legal proceedings. The Court upheld the High Court's decision, stating that the appellant could not raise new arguments at this stage.
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