9911796707
TMI Blog2002 (6) TMI 519X X X X Extracts X X X X X X X X Extracts X X X X ..... that plywood and Veneer, manufactured by the Appellants, were initially assessed on provisional basis under Rule 9B of the Central Excise Rules, 1944; the assessments were finalized by the Assistant Commissioner under Order dated 23-2-1999 whereupon a differential duty amounting to Rs. 1,37,49,625/- was determined as payable by the Appellants; that the assessment order was received by them on 1-3-1999, that the jurisdictional Superintendent in exercise of powers conferred under Rule 230 of the Rules, detained the goods valued at Rs. 1,43,51,788/- lying in their bonded warehouse in the factory on 10-3-99; that the Appellants, by a letter dated 1-6-99 requested the Commissioner to withdraw the detention order or, in the alternative, to take t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... fore they could take any step, the Assistant Commissioner, by another letter dated 12-5-2000, informed them that if payment were to be made in instalments, interest would have to be calculated for the entire period of payment to determine their interest liability and the so calculated interest amount would have to be added to the duty amount for determining the total dues which would then be divided by 36 to arrive at monthly instalment figure. The ld. Advocate contended that this direction not only would result in payment of interest upon interest but would also amount to making payment of interest on the part of the principal amount which would have been already paid in terms of the permission granted in the respective monthly instalments ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of Rs. 1.38 crores (approx.) to be paid"; that it was, therefore, incumbent upon the Department to either allow them to sell the said goods and make payment out of the sale proceeds or, in the alternative, to take the said goods towards settlement of their dues; that having not resorted to any of these options, the Department can have no right, authority or jurisdiction to demand interest from them; that as such the demand of interest is illegal and untenable; that no interest can be demanded as the same is inequitable, unjust, arbitrary, un-reasonable and perverse; that the prolonged detention of goods must have eroded the value of the detained goods and therefore, the Department is bound to compensate the Appellants. Reliance had been pla ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... onsidered the submissions of both the sides. The facts which are not in dispute are that plywood and veneer manufactured by the appellants were assessed provisionally and on finalization of the provisional assessments, the differential duty amounting to Rs. 1.37 crores (approx.) was demanded from the appellants and within 15 days of finalizing the assessments, the Department detained the entire stock of plywood and veneer worth Rs. 1.43 crores (approx.) lying in the bonded warehouse of the Appellants. It is also not in dispute that after detaining the entire stock of the finished goods manufactured by the Appellants, the Department has not taken any step to dispose of the goods and realise the arrears of Government revenue out of the sale p ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rential duty to the Revenue. They have also lost notional interest which they could have earned, had they been allowed to sell the goods under detention during the last more than three years. However, as pointed out by the ld. Counsel for the appellants, interest on delayed payment of duty is chargeable only under the provisions of Section 11AA of the Central Excise Act, 1944 which provides for levy of interest if a person fails to pay duty determined under sub-section (2) of Section 11A of the Central Excise Act, 1944. It is not the case of the Revenue that the duty due from the Appellants in the present matter was determined under Section 11A (2) of the Central Excise Act, as the duty became payable on the finalization of the provisional ..... X X X X Extracts X X X X X X X X Extracts X X X X
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