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2015 (9) TMI 251 - ALLAHABAD HIGH COURT

2015 (9) TMI 251 - ALLAHABAD HIGH COURT - TMI - Power to issue demand notice - manufacture of industrial alcohol as well as potable alcohol - Demand of interest u/s 38A - Held that:- In the case of the petitioner while questioning the validity of the amendment made in Rule 12 of the Rules, a Division Bench of this Court held in its judgment [2011 (7) TMI 1122 - ALLAHABAD HIGH COURT] that Rule 12 of the Rules was made in exercise of powers under Section 41 of the Act and such overtime charges req .....

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der Section 38-A of the Act. We are of the opinion that so long the decision of this Court dated 26.07.2011 stands and is not set aside by the Supreme Court, the imposition of interest by the respondent is justifiable under Section 38-A of the Act - Decided against the assessee. - Civil Misc. Writ Petition No. 475 of 2012 - Dated:- 3-9-2015 - Hon'ble Tarun Agarwala And Hon'ble Surya Prakash Kesarwani, JJ. ORDER ( Per : Tarun Agarwala, J. ) 1. The petitioner is engaged in the manufacture .....

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ification was challenged by the petitioner in writ petition no. 1327 of 2007 on the ground that the amendment in the rates of overtime charges was without any statutory backing and that the enhancement of overtime charges was without any basis and had no co-relation with the services rendered by the Excise Department. During the pendency of the writ petition, the Excise Department raised a demand of ₹ 29,62,007.45 towards overtime charges for the extra hours for which the distillery on its .....

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to run the distillery." 3. The petitioner along with other similarly situated persons filed Special Leave Petition before the Supreme Court, which was entertained and leave was granted by an order dated 09.01.2012 holding that the appeals would be heard. The appeals are still pending disposal before the Supreme Court of India. 4. Thereafter, demand notices dated 22.03.2012 and 27.03.2012 were issued demanding payment of interest on late deposit of overtime charges. The petitioner made a rep .....

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l for the State. 6. Several grounds have been raised in the writ petition, namely, that the respondents had no power to issue the demand notices. It was however contended that the interest could only be charged under Section 38-A of the Act on arrears of excise revenue. It was contended that overtime charges paid under Rule 12 of the Rules is not an excise revenue and, therefore, interest on such overtime charges could not be charged or realised under Section 38-A of the Act. It was also contend .....

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d within three months from the date on which it becomes payable, interest at such rate not exceeding twenty-four percent per annum, as may be prescribed, shall be payable from the date such excise revenue becomes payable till the date of actual payment. Provided that until a higher rate is prescribed, the rate of interest will be eighteen percent per annum; Provided further that in respect of an excise revenue which became payable before the commencement of the Uttar Pradesh Excise (Amendment). .....

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filed before the said date. (2) Provisions of Section 39 shall mutatis mutandis apply to realisation of such interest as they apply to realisation of excise revenue." 8. A perusal of the aforesaid provisions indicates that where any excise revenue has not been paid within three months from the date on which it becomes payable, interest would then become payable. The words "Excise Revenue" has been defined under Section 3(1) of the Act, which is as under: 3(1)"excise revenue&q .....

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