2024 (3) TMI 449 - AT - Central Excise

Levy of interest under Section 11AB of the Central Excise Act, 1944 on supplementary invoices by invoking extended period of limitation - appellant has availed irregular cenvat credit as well as failed to pay the duty on certain goods on certain instances - HELD THAT - The said issue has been dealt by this Tribunal in the case of CCE VERSUS TVS WHIRLPOOL LTD. 1999 (10) TMI 701 - SC ORDER wherein it has been held that it is only a reasonable time that the period of limitation that applies to a claim for the principal amount should also apply to the claim for interest thereon and further in the case of HINDUSTAN INSECTICIEDES LTD. VERSUS COMMISSIONER CENTRAL EXCISE, LTU 2013 (8) TMI 225 - DELHI HIGH COURT , again the said issue was examined by the Hon ble Delhi High Court wherein the Hon ble High Court has held A reading of the aforesaid paragraph would show that in the said case notice of payment for interest was issued after four years and it was held that it was beyond a reasonable period and the department could recover the amount from the Assessing Officer, who had not taken steps for four years and not from the respondent-assessee therein. The finding of the Supreme Court on interpreting the applicable Act was that no limitation period was prescribed, therefore, proceedings for recovery could be initiated within a reasonable time. The extended period of limitation is not invokable for the facts and circumstances of the case as the appellant has paid the duty on the supplementary invoices during the period 2008-09 and the same shown in their records and audit was also conducted during the period from 15.11.2009 to 03.12.2009. The extended period of limitation is not invokable. Consequently , the demand of interest on supplementary invoices is barred by limitation. The impugned order quo demanding interest on the duty paid on supplementary invoices set aside - appeal allowed.

Summary

Issues involved: Appeal against demand of interest under Section 11AB of the Central Excise Act, 1944 for payment of duty on supplementary invoices.

Summary:
The appellant, engaged in manufacturing steel products, availed cenvat credit and paid duty on inputs, capital goods, and service tax on input services. During an audit for 2008-09, irregular cenvat credit and short duty payment were observed. A show-cause notice was issued, and after adjudication, cenvat credit was denied, and duty demand was confirmed. The specific issue was the payment of interest on supplementary invoices. The appellant raised these invoices due to inter-branch stock transfer, goods diverted to a stock yard, and price revision. The appellant contended they were not liable to pay interest based on precedents. The Revenue argued that interest should have been paid at the time of duty payment on supplementary invoices. The Tribunal referenced relevant cases and held that the extended period of limitation was not applicable as duty was paid on the supplementary invoices during 2008-09, and audit was conducted within a reasonable time. Consequently, the demand for interest on supplementary invoices was deemed barred by limitation, and the impugned order was set aside, allowing the appeal.