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TMI Blog2014 (11) TMI 781X X X X Extracts X X X X X X X X Extracts X X X X ..... me in terms of Section 11AB of the Central Excise Act, and consequently, the impugned demand notices are also quashed and set aside. - Decided in favour of assessee. - Special Civil Application Nos. 16284 and 23751 of 2005 - - - Dated:- 20-6-2013 - M.R. Shah and Sonia Gokani, JJ. Shri S.N. Thakkar and Bharat T. Rao, Advocates, for the Petitioner. Shri P.S. Champaneri and R.J. Oza, Advocates, for the Respondent. ORDER As a common question of law and facts arise in both these writ petitions, they are being disposed of by this common judgment and order. 2. That the controversy in both the petitions is with respect to the period between May, 2003 to August, 2004 so far as Special Civil Application No. 16284 of 2005 is ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... one thousand per day, or whichever is higher as ultra vires Section 11AB of the Central Excise Act, 1944 ( Act for short). 4. Shri Devan Parikh, learned senior advocate with Shri S.N. Thakkar, learned advocate appearing on behalf of the petitioner in Special Civil Application No. 16284 of 2005 and Shri B.T. Rao, learned advocate appearing for the petitioner in Special Civil Application No. 23751 of 2005 have vehemently submitted that as such the question involved in the present petitions is squarely covered by the decision of Rajasthan High Court in case of Lucid Colloids Limited v. Union of India, reported in 2006 (200) E.L.T. 377 (Raj.). It is submitted that in the aforesaid decision, the Rajasthan High Court has declared part of Rul ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r sub-rule (3) of Rule 8 of the Rules, an assessee who fails to pay amount of duty by the due date, was liable to pay the outstanding amount along with interest at the rate specified by the Central Government by a Notification issued under Section 11AB of the Act on the outstanding amount, for the period starting with the first day after due date, till the date of actual payment of the outstanding amount. However, subsequently, sub-rule (3) of Rule 8 of the Central Excise Rules came to be amended by a Notification No. 12 of 2003, dated 1st March, 2003, which provided that if the assessee fails to pay amount of duty by the due date, he shall be liable to pay the outstanding amount along with interest at the rate of two per cent per month or ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n case of Lucid Colloids Limited (supra), we are in complete agreement with the view taken by the Rajasthan High Court holding so. 8. In view of the above and for the reasons stated hereinabove, both these petitions succeed. Part of Rule 8(3) of the Central Excise Rules, 2002, which was prevailing at the relevant time as per Notification No. 12/2003, dated 1st March 2003, which includes expression, at the rate of two per cent per month or rupees one thousand per day, whichever is higher is held to be invalid and consequently, it is held that the interest chargeable on the delayed payment had to be only at the rate of two per cent per month, or for that matter twenty four per cent per annum, as notified by the Government at the relevant ..... X X X X Extracts X X X X X X X X Extracts X X X X
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