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TMI Blog2015 (9) TMI 149X X X X Extracts X X X X X X X X Extracts X X X X ..... n in the case of Lucid Colloids Limited V. Union of India [2005 (8) TMI 134 - HIGH COURT OF RAJASTHAN] - Decided in favour of assessee. - Writ Petition Nos.3773 to 3776, 27650, 24810, 39275 of 2005 & Connected Miscellaneous Petitions - - - Dated:- 27-3-2015 - Mr. R. Sudhakar and Mr. T. Raja, JJ. For the Petitioner : Mr. Jaikumar, Mr. K. Jayachandran For the Respondent : Mr. K. Mohanamurali, Mr. T. Chandrasekaran, Mr. Vikram Ramakrishnan, Mr. Haja Mohideen Gisthi Common Order (Order of the Court was made by R. Sudhakar,J.) The above Writ Petitions are filed challenging Rule 8(3) of the Central Excise Rules as violative of Articles 14, 19(1)(g), 50 and 265 of the Constitution of India and also to set aside the cons ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... o be amended but within the limit prescribed, the Central Government may adjust the rate of interest chargeable on delayed payments, making it sure that delayed payment not become profitable on account of charge of interest at rate lower than market rate of interest. 10. The prescription of limit of rate of interest at 10% per annum and 36% per annum respectively also makes it clear that basic base of charge of interest is rate per annum and not on any other basis. The provision made in Rules results in altering the nature of charge of interest from compensatory to penalty. By providing rate of interest @ 2% p.m. interest or 24% per annum, the charge of interest cannot be made payment of interest at monthly rates. Interest rate @ 2% pe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... vy of interest at the rate of ₹ 1,000/- which is higher as alternative to charge of interest @ 2% on the amount of Duty means to be understood as 24% per annum on the amount of Duty in default is ultra vires to Section 11AB of the Act and cannot be sustained and is held inoperative. 15. Accordingly, the writ petition is allowed. The part of Rule 8(3) 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. Consequently, interest chargeable on delayed payment had to be only at the rate of 2% per month or for that matter 24% per annum as notified by the State Government in terms of the Section 11BC, which is between the permissible limits in terms of ..... X X X X Extracts X X X X X X X X Extracts X X X X
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