TMI Blog2011 (10) TMI 162X X X X Extracts X X X X X X X X Extracts X X X X ..... rential duty before finalization of assessment on their own, it is only a pre-deposit of duty and not payment of duty, which can be done only after the determination of the duty liability by a proper officer. Such a pre-deposit does not in any way exhaust the interest liability on the assessee from the date on which the duty was required to be paid originally i.e at the time of clearance of the goods from the place of removal and the date on which the duty liability was ultimately discharged. Accordingly the matter was placed before divisional bench for consideration. - E/1120 & 1121/2008 - M/200 & 201/WZB/MUM/2011/SMB/C-IV - Dated:- 21-10-2011 - Shri P.R. Chandrasekharan, J. Represented By: Shri A K Prabhakar, JDR for Appellant ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ity demanding interest in terms of Rule 8(3) of the Central Excise Rules, 2002 with consequential relief. The department is in appeal before us against the impugned orders. 3. In the grounds of appeal it has been urged that as per the provision of sub-rule (4) of the Rule 7 of the Central Excise Rules, 2002, the assessee is liable to pay interest on any amount payable to the Central Government consequent to order of final assessment at the rate specified by the Central Government by notification issued under section 11AA or section 11AB of the Act from the 1st day of the month succeeding the month for which such amount is determined till the date of payment thereof. Therefore, though the assessee has paid the differential duty on their ow ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ion of the Appellants that if no interest is levied, the assessee would be benefited by delaying the duty payment and still not paying the interest. (iii) Interest under rule 7(4) is not attracted if differential duty paid before the date of Order passed for finalizing the assessment decision of CESTAT in Respondent's own case The contention of the appellants that they have filed appeal and therefore this decision should not have been followed is not sustainable. 4.1 The counsel further submits that the Hon'ble High Court of Bombay in the case of Commissioner of Central Excise vs. Ispat Industries Ltd. reported in 2010 (259)ELT 662(Bom) had held that in a case where differential duty was paid prior to the date of finalization of ass ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Central Excise Rules, 2002 is correct when the provisional assessment and the finalization of assessment were done under Rule 7 of the said Rules. The second issue pertains to revenue neutrality, i.e when the duty paid by the appellant is available as CENVAT Credit at the recipient unit, whether delay in payment of duty will result in any undue benefit to the assessee requiring levy of interest. The third issue relates to the question whether interest can be levied under Rule 7(4) of the Central Excise Rules, 2002 in the case of a provisional assessment where the assessee has discharged the differential duty liability before the finalization of the assessment. The third issue is the main and fundamental issue in the facts and circumstances ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Rules, is issued finalizing the assessment and said interest will be payable from the first day of the month succeeding the month for which such amount is determined. This decision of the Tribunal was based on the Hon'ble Supreme Court's decision in the case of Commissioner of Central Excise, Mumbai vs. ITC Ld. reported in 2006(203)ELT 532(SC). In the said case, while dealing with the erstwhile Rule 9B of the Central Excise Rules, 1944 relating to provisional assessment, the Hon'ble Apex Court held as under:- Whereas provisional duty is levied in terms of Sub-Rule (1) of Rule 9B, final assessment is contemplated under Sub-Rule (5) thereof by reason of which the duty provisionally assessed shall be adjusted against the duty finally asses ..... X X X X Extracts X X X X X X X X Extracts X X X X
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