TMI Blog2013 (3) TMI 432X X X X Extracts X X X X X X X X Extracts X X X X ..... the amendment cannot be considered to be retrospective in nature; and cannot be made applicable to pending proceedings. - Decided against the revenue. - TAX APPEAL No. 1163 of 2011 - - - Dated:- 27-1-2012 - MR. AKIL KURESHI AND MS SONIA GOKANI JJ. Appearance: MS AMEE YAJNIK for Appellant(s):1, ORAL ORDER (Per : HONOURABLE MS JUSTICE SONIA GOKANI) Appellant has challenged an order of the CESTAT dated 18.02.2011 proposing following questions for our consideration: (a) Whether in the facts and circumstances of this case when Provisional Assessment was made prior to 13.07.2006, the date on which Section 18(3) was inserted by way of Taxation Laws (Amendment) Act, 2006, interest can be chargeable on the amount of differential duty determined upon Final Assessment made after 13.07.2006, taking resort to Section 28-AB of the Customs Act, 1962? (b) Whether in the facts and circumstances of the case, Section 18(3) which is inserted on 13.07.2006 by way of Taxation Laws (Amendment) Act, 2006 can be applied retrospectively being declaratory and clarificatory in nature? (c) Whether interest can be chargeable under Section 28-AB though Final Assessment is made o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... materially amended with effect from 13.07.2006. Sub-Section 3 of Section 18 in the present form as it stood amended from 13.07.2006 reads as follows: (3) The importer or exporter shall be liable to pay interest, on any amount payable to the Central Government, consequent to the final assessment order under sub-section (2), at the rate fixed by the Central Government under Section 28-AB from the first day of the month in which the duty is provisionally assessed till the date of payment thereof. 9. The question is, can above mentioned provision be applied for charging interest on the differential duty for the period prior to 13.07.2006 or even thereafter. 10. In Sterlite (supra), Chennai Bench of the Tribunal had examined this provision at length and referring to a peri materia provision of sub-rule (4) Rule 7 of the Central Excise (No.2) Rules,2001 and the clarification issued by CBEC on charging interest under such provision, the Tribunal came to the conclusion that in cases of provisional assessment made prior to 13.07.2006, no interest could be charged. The Tribunal's observations in this regard can be noted: 2. After considering the grounds of these appeals, argumen ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to 01.07.2001 and its finalization was effected after that date. We find that sub-section (3) of Section 18 of the Customs Act and sub-rule (4) of Rule 7 of the Central Excise (No. 2) Rules, 2001 are pari materia provisions. Ld. JDR has not cited any circular of the Board interpreting or clarifying the Customs provision differently. 3. As already indicated, all the provisional assessments in the present cases were made prior to 13.07.2006 and the same were finalized after the said date. Hence the view rightly taken by the Board in relation to Rule 7(4) ibid must be squarely applicable in principle to these cases. 4. In the result, the decision of the lower authorities to levy interest from the assessee on the amounts of differential duty paid upon finalization of the provisional assessments made prior to 13.07.2006 cannot be upheld. Any levy incidental to finalization of a provisional event will be governed by the law which was in force at the time of the provisional event. On this basis, we hold that no interest can be levied under Section 18(3) of the Customs Act on the differential amounts of duty paid by the appellants upon finalization of the provisional assessments whic ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d that even when no claim of total or partial partition is made at the time of making assessment under Section 143 or 144 of the Act, if it is found after the completion of assessment that the family has already effected as partition, total or partial, all the members shall be jointly and severally liable for the tax as payable by the joint family and the tax liable shall be apportioned among the members according to the portion of the joint family property allotted to each of them. The Apex Court was of the opinion that sub-section 6 of Section 171 thus, for the first time, imposed in the case of this kind joint and several liability on the members for the tax assessed on Hindu Undivided family and thus was personal liability as distinguished from the liability limited to the joint family property received on partition. The Apex Court thereupon held and observed that: We cannot, therefore, consistently with the rule of interpretation which denies retrospective operation to a statute which has the effect of creating of imposing a new obligation or liability, construe sub-section (6) of Section 171 as embracing a case where assessment of a Hindu undivided family is made under th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e to liability to pay interest or entitlement to claim interest consequent upon final assessment order. However, sub-section (5) is the material amendment which indicates that the Proviso appearing below sub-section (2) of Section 27 of the Act has now been incorporated as a part of Section 18 of the Act. On a plain reading the distinction between Section 18 as it stood prior to amendment i.e. upto 12.07.2006 and subsequent to the amendment I.e. with effect from 13.07.2006 becomes apparent. The difference is stark and revealing and it is not possible to agree with the contention of revenue that such amendment has to be understood as clarificatory in nature. This is more so, when one reads the amendments made in 1998 and the amendment made in Rule 9B of the Central Excise Rules in 1999 considering the pronouncement of the Apex Court as to the distinction between making of a refund and claiming of a refund; the amendment cannot be considered to be retrospective in nature; and cannot be made applicable to pending proceedings. 19. This can be considered from a slightly different angle. While introducing the Taxation Laws (Amendment) Bill, 2005 (Bill No. 74 of 2005) the Notes on Claus ..... X X X X Extracts X X X X X X X X Extracts X X X X
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