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TMI Blog2017 (5) TMI 606X X X X Extracts X X X X X X X X Extracts X X X X ..... ade - there is no doubt that assessee is entitled to adjustment of the excess paid duty towards short paid duty. Liability of interest - whether assessee is required to pay interest on the differential duty payable which was paid suo moto by the assessee before the finalization of the provisional assessment? - Held that: - decision in the case of CCE Nagpur vs. Ispat Industries Ltd. [2010 (10) TMI 178 - BOMBAY HIGH COURT], relied upon, where it was held that Since differential duty was paid even before the final assessment was made, the Tribunal has held that the respondent assessee is not liable to pay interest - as differential duty has been paid by the assessee before the assessment were finalized, there cannot be any liability of int ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t paid duty of ₹ 1,10,43,480/-, the appellant paid the differential duty of ₹ 85,62,667/- on 6.9.2010. 3.1 The issue is whether the assessee-appellant can be allowed adjustment of short paid duty against excess paid duty during the provisional assessment . Another issue is payment of interest on the differential duty payable which was paid suo moto by the assessee before the finalization of the provisional assessment. 4. With the above background, we have heard learned Counsels of both the sides, namely Shri Dhruv Tiwari for the appellant and Shri G R Singh for the Revenue. 5. In case of issue of adjustment of short paid duty with excess paid duty during provisional assessment, the matter is covered by the assessee s ow ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hs from the date of the communication of the order issued under sub-rule (1): Provided that the period specified in this sub-rule may, on sufficient cause being shown and the reasons to be recorded in writing, be extended by the Commissioner of Central Excise for a further period not exceeding six months and by the Chief Commissioner of Central Excise for such further period as he may deem fit. (4) The assessee shall be liable to pay interest on any amount payable to Central Government, consequent to order for final assessment under sub-rule (3), at the rate of twenty four percent per annum from the first day of the month succeeding the month for which such amount is determined, till the date of payment thereof. (5) Where th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ch in the Excel Rubber Limited case is that before grant of adjustment the authority finalising the provisional assessment will have to ascertain whether such excess amount is to be actually refunded or is liable either wholly or partly to be credited to the Consumer Welfare Fund and only thereafter make an order of adjustment to the extent the amount found to be actually refundable. 5. However, this has been interpreted differently by the Hon ble High Court of Karnataka in the case of Toyota Kirloskar Auto Parts Pvt. Ltd. (supra). The relevant wording of the decision is as under: 8. Therefore, it is clear that after a final assessment order is passed, if the duty paid in terms of provisional assessment is less than the duty paya ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sessment. The approach of the authorities in this regard is erroneous, unwarranted and unsupported by any statutory provision. If we keep in mind the principle underlying the provisions, it is only when the duty is due and it is not paid within the stipulated time and the duty is paid thereafter, in order to compensate the revenue, interest is imposed. If that is to be kept in mind, in the instant case, when the assessee has paid a sum of ₹ 1,66,56,740/- excess duty which is entitled to claim refund, he cannot be taxed with payment of excess duty in the form of interest. The entire approach of the department is unreasonable, contrary to the scheme of the Act and negatives the principle underlying these provisions. Therefore, all the a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ment till the date of payment. Since differential duty was paid even before the final assessment was made, the Tribunal has held that the respondent assessee is not liable to pay interest. In our opinion, no fault can be found with the order of the Tribunal. Accordingly, question raised by the revenue is answered in favour of the assessee and against the revenue. The appeal is disposed of. No order as to costs. 8. In the present case, differential duty has been paid by the assessee before the assessment were finalized. When it is so, following the Hon ble Bombay High Court decision cited (supra), I hold that there cannot be any liability of interest against the assessee. 9. In the result, impugned order is set aside and appeals allo ..... X X X X Extracts X X X X X X X X Extracts X X X X
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