TMI Blog2011 (6) TMI 619X X X X Extracts X X X X X X X X Extracts X X X X ..... l is heard in terms of order passed today in Excise Stay application No. 564 of 2010. 2. Heard the learned Advocate for the appellants and DR as well as Joint CDR for the respondent. 3. The present appeal arises from order dated 15-12-2009 passed by the Commissioner, Faridabad. By the impugned order, the demand for interest to the tune of Rs. 6,40,218/- has been confirmed against the appellants. 4. While fairly conceding that on merits, the case is covered by the decision in Commissioner of Central Excise, Pune v. SKF India Ltd. reported in 2009 (239) E.L.T. 385 (S.C.), ld. Advocate drawing our attention to the impugned order submitted that the demand in relation to the interest relates to the month of June 2007 while the show cause notice was issued only on 5-8-2009. Applying the principles behind Section 11A of the Central Excise Act, 1944, the ld. Advocate submitted that the normal period prescribed thereunder for initiating any action for recovery of duty if held to be applicable to such cases also, then the notice ought to have been issued within one year from June 2007 and having not done so, the claim was clearly barred by limitation. There was no allegation of suppres ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... consolidated provision instead of being split up in Sections 11AA and 11AB. Also, there is much scope to reorganise all the different sub-sections of Section 11A and to present the scheme of that section in a more coherent and readable form. 8. Be that as it may. In the case in hand we have to deal with the law as it stands now. 9. Section 11A puts the cases of non-levy or short levy, non-payment or short payment or erroneous refund of duty in two categories. One in which the non-payment or short payment etc. of duty is for a reason other than deceit; the default is due to oversight or some mistake and it is not intentional. The second in which the non-payment or short payment etc. of duty is by reason of fraud, collusion or any wilful mis-statement or suppression of facts, or contravention of any of the provisions of the Act or of Rules made thereunder with intent to evade payment of duty ; that is to say, it is intentional, deliberate and/or by deceitful means. Naturally, the cases falling in the two groups lead to different consequences and are dealt with differently. Section 11A, however allow the assessees in default in both kinds of cases to make amends, subject of cour ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rescribed therefore. It is not for courts to import any specific period of limitation by implication, where there is really none, though courts may always hold when any such exercise of power had the effect of disturbing rights of a citizen that it should be exercised within a reasonable period. Section 11A of the Central Excise Act, 1944 is not an omnibus provision which provides any period of limitation for all or any and every kind of action to be taken under the Act or the Rules but will attract only to cases where any duty of excise has not been levied or paid or has been short levied or short-paid or erroneously refunded. The Section also provides for an extended period on certain contingencies and situations. Having so observed, the Apex Court recorded that the situation in the case before the Apex Court in Raghuvar (India) case which was required to be dealt with under Rule 57-I as it stood unamended at the relevant time and, therefore, did not fall under any one of those contingencies provided for in Section 11A of the Central Excise Act. Apparently, the Apex Court was dealing with a totally different set of facts and circumstances and in that context the observations were ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e......... The terminal part in the quotation above, which is couched with the words shall and be liable clearly indicates that there is no option. As discussed earlier, this is a civil liability of the assessee, who has retained the amount of public exchequer with himself and which ought to have gone in the pockets of the Central Government much earlier. Upon reading Section 11AB together with Sections 11A and 11AA, we are of firm view that interest on the duty evaded is payable and the same is compulsory and even though the evasion of duty is not mala fide or intentional. 11. The question then arises whether payment of duty before issuance of show cause notice exempts the assessee from liability to pay interest u/s. 11AB. Learned Counsel Shri Kolte had placed reliance upon concluding para in the judgment of CESTAT Bangalore in the matter of Rashtriya Ispat Nigam Ltd. v. Commissioner of Central Excise, Visakhapatnam, which reads thus : In these circumstances, there is no justification on the part of the department to impose penalty u/s. 11AC as well as under Rule 173Q of the Central Excise Rules, 1944. Consequentially, no interest also is payable. In the matter, pen ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to further interest also on the amount of short duty as ascertained by the department if that exceeds the self-assessment and to that extent. By this explanation, we are convinced that even if no notice is issued by the department because it agrees with the amount of short duty paid by the assessee as ascertained by the assessee himself under sub-section (2B), still the assessee shall be liable to pay interest over the same even without going through the process of determination as contemplated by Section 11A(1) and (2) commencing with a show cause notice and culminating with an order of the Central Excise Officer. The show cause notice and determination can go on if the short duty is not paid, but even if short duty is paid by taking liberty under sub-section (2B), we are afraid, that does not absolve the assessee from the liability to pay interest thereon. In case by proceeding with the show cause notice, if the Central Excise Officer determines short duty payable higher than as ascertained and paid by the assessee himself, the assessee would be liable to pay interest u/s. 11AB upon the same. Emphasis by Advocate Shri Kolte was on the tail piece of sub-section (2B). According t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... escribed for recovery of duty is six months or five years as above and also the period for claim of refund is also six months. The position being similar we hold that the same logic should apply in respect of the recovery to be made under the Customs Act where no period of limitation has been prescribed. We therefore hold that the Ld. Lower Authority is right in holding that the demand for interest beyond the period of six months from clearance of goods is barred by limitation and we therefore uphold the order of the lower authority and dismiss the appeals. We observe that the relevant date for demand of duty would be date on which goods were allowed clearance from the Warehouse as the interest is required to be paid till the date of clearance in terms of Rule 61(3) of the Customs Act, 1962. The department recovered at the time of clearance the duty as well as interest as held payable at that time and cancelled the bonds. Taking into consideration the relevant date the demand have been clearly raised much after the period of six months. The Appeals of the Revenue are therefore dismissed. 10. Being dissatisfied, the department had carried the matter in appeal before the Apex Cour ..... X X X X Extracts X X X X X X X X Extracts X X X X
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