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TMI Blog2019 (2) TMI 563X X X X Extracts X X X X X X X X Extracts X X X X ..... llant. In this case, the duty which was paid by the appellant for which they were not liable to pay, the duty was paid voluntarily by the appellant. Therefore, the duty which was not lawfully required to be paid even though the appellant pay on their own, the department has no authority to recover interest or impose penalty with respect to such payment of duty even though belatedly - the provision of Section 11AB of Central Excise Act shall be applicable only in case where the duty which is lawfully required to be paid by an assessee and the same is not paid. Section 11A (2B) of CEA - Held that:- The sub section (2B) is also applicable only in case where duty is payable with authority of law. Moreover, the appellant have not opted fo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r sale without a brand name. However, subsequent to the clearance of goods to buyers M/s BPCL and M/s HPCL, in some cases they had converted the same quantity of such duty paid un-branded Petrol/Diesel into branded Petrol fuel by adding some additives under the misconception of law. The appellant voluntarily paid differential duty on such branded fuel, as and when they received necessary details from the said buyers M/s BPCL and M/s HPCL. The payment of duty was reflected in their ER-1 returns. On that basis SCN dated 30.07.2010 demanding interest on the aforesaid duty in respect of clearances made during the period from March 2008 to October 2009 was issued. The adjudicating authority confirmed the demand of interest under Section 11AB and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... that the Commissioner has unjustly held that, once the appellant has paid differential duty, interest should also be payable inevitable. He submits that once duty itself admittedly not payable, question of consequential penalty and interest does not arise. He placed reliance on the following judgments: Bonanaza Engineering Chemicals Pvt. Ltd 2012-TIOL-25-SC Narsepalli Oil Mills MANU/KA/0032/1973 Gujarat Narmada Fertilizers Co. Ltd 2010 (262) ELT 829 (T) Gujarat Narmada Fertilizers Co. Ltd 2012 (285) ELT 336 (Guj.) Subray Catal chemicals P. Ltd 2010 (261) ELT 1170 (T) He also submits that the SCN dated 30.07.2010 issued for longer period is patently time barred in terms of Section 11A. He takes support of the follow ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in terms of aforesaid Notification. Therefore, differential duty was not payable at all by the appellant. The interest was demanded under Section 11AB, which reads as under: Section 11AB: Interest on delayed payment of duty (1) Where any duty of excise has not been levied or paid or has been short-levied or short-paid or erroneously refunded, the person who is liable to pay duty as determined under sub-section (2), or has paid the duty under sub-section 2(B), of section 11A, shall, in addition to the duty, be liable to pay interest at such rate not below 3[ten per cent.] and not exceeding thirty-six per cent. per annum, as is for the time being fixed by the Central Government, by notification in the Official Gazette, from the f ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e may be, the Court, the interest shall be payable on such increased or further increased amount of duty.] 6. From the plain reading of above section 11AB, it is seen that the interest is chargeable only in case where any duty of excise has not been levied or paid or has been short levied or short paid and erroneously refunded, the person, who is liable to pay duty as determined under sub section (2) or has paid the duty under sub section (2B) of Section 11A shall be liable to pay interest. That means, the first condition is, the person, who did not pay the duty which he was liable to pay. In this case, the duty which was paid by the appellant for which they were not liable to pay, the duty was paid voluntarily by the appellant. There ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... mation of payment. Explanation 1. -Nothing contained in this sub-section shall apply in a case where the duty was not levied or was not paid or was short-levied or was short-paid or was erroneously refunded by reason of fraud, collusion or any wilful mis-statement or suppression of facts, or contravention of any of the provisions of this Act or of the rules made thereunder with intent to evade payment of duty. Explanation 2. -For the removal of doubts, it is hereby declared that the interest under section 11AB shall be payable on the amount paid by the person under this sub-section and also on the amount of short-payment of duty, if any, as may be determined by the Central Excise Officer, but for this sub-section.] [Explan ..... X X X X Extracts X X X X X X X X Extracts X X X X
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