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TMI Blog2013 (9) TMI 581X X X X Extracts X X X X X X X X Extracts X X X X ..... prescribed under Central Excise (Removal of Goods at Concessional Rate of Duty for Manufacture of Excisable Goods) Rules, 2001. Appellants used some quantity of Naphtha, so procured at nil rate of duty, for purposes other than for the manufacture of Fertilizer. In respect of the quantity of Naphtha which was not so used for the prescribed purpose, the appellants voluntarily paid up the appropriate duty involved on such quantity. The payment of duty on the quantity of Naphtha not used in the manufacture of Fertilizer was made in the respective following months after removal of the Naphtha for other purposes. A show cause notice No. V. Ch. 28(4)2/SCN/Dn-I/05 dated 26-4-2005 was issued to the appellants proposing to impose penalty and charge ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... facture of Excisable Goods) Rules, 2001 read with Section 11AB of the Central Excise Act, 1944. 3. Being aggrieved by the order passed by the adjudicating authority in de novo proceedings, assessee preferred an appeal before the first appellate authority, raising various questions of law and disputing the liability to pay the interest. The first appellate authority after following due process of law, did not agree with the contentions raised by the appellant before him. He concurred with the views of the first appellate authority and held that there is no infirmity in the order-in-original and coming to such a conclusion, the appeal was rejected, hence this appeal. 4. Ld. counsel submits that show cause notice dated 26-4-2005 for demand o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... pensation for withholding somebody's money. 5. Ld. D.R. reiterates the findings of the lower authorities and submits that there is no dispute that the appellant has used the Naphtha which was procured under concessional rate of duty for consumption in manufacture of fertilizer, but some quantity of the said Naphtha has been diverted for manufacturing of use of non-fertilizers. It is his submission that provisions of Rule 6 of the said concessional rate of duty would apply wherein liability arises on the appellant as soon as he diverts the non-duty paid Naphtha for non-specific use. 6. I have considered the submissions made at length by both sides and perused the records. 7. The issue involved in this case is regarding whether the appella ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 5. This would indicate that the show cause notice which has been issued on 26-4-2005, at the most can be pressed into service for demand of the interest by the Revenue for a period of one year from the date of show cause notice i.e. from 26-4-2004 while the demand of the interest is for the period April 2001 to March 2004. I find strong force in the contentions raised by the ld. counsel that an identical issue came before the Division Bench of the Tribunal in the case of EMCO Ltd. (supra) wherein this Tribunal held as under : "10. A similar issue came up for consideration before the Hon'ble Apex Court in the case of GOI v. Citedal Fine Pharmaceuticals - 1989 (42) E.L.T. 515 (S.C.). In that case the Hon'ble Apex Court held that in the absen ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... re also reflected in the corresponding monthly returns filed by the assessee. Thus, the department was fully aware that the assessee was raising supplementary invoices for recovery of differential prices subsequent to the clearance of the goods and they were also discharging differential duty liability on issue of supplementary invoices. Therefore, it was incumbent on the department to recover interest which the assessee had failed to pay within a reasonable period. In a similar case, the Hon'ble Apex Court in the case of Commissioner v. TVS Whirlpool Ltd. [2000 (119) E.L.T. A177 (S.C.)] held as follows - "It is only reasonable that the period of limitation that applies to a claim for the principal amount should also apply to the claim for ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... It is, therefore, clear that the principle adopted by the Supreme Court was that the period of limitation, unless otherwise stipulated by the statute, which applies to a claim for the principal amount should also apply to the claim for interest thereon. If that be the position, the period of limitation prescribed for demand of duty under Section 11A is normally one year and, in exceptional circumstance of a case falling under the proviso to Section 11A(1) the period of limitation is five years. But that would be applicable only in case of misstatement, fraud, concealment etc., which is not the case here. As such, in the present case, the period of limitation for the demand for duty would be one year. By the same logic, the period of limita ..... X X X X Extracts X X X X X X X X Extracts X X X X
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