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2015 (10) TMI 570

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..... nder Section 11A (2B) and interest is automatic. - Further the Hon'ble Supreme Court in the subsequent judgement in the case of CCE Vs International Auto Ltd. (2010 (1) TMI 151 - SUPREME COURT OF INDIA) also upheld that demand of interest under Section 11AB by referring to their order in the case of SKF India Ltd. (2009 (7) TMI 6 - SUPREME COURT). - issue relating to demand of interest on the differential duty paid stands settled by the apex court. By respectfully following the judgement of apex court, I hold that appellants are liable to pay interest demanded in the impugned order - Decided against assessee. - Appeal No. E/MISC/40205/2015 & E/812/2007 - Final Order No.40659/2015 - Dated:- 17-6-2015 - Shri R. Periasami, Technical Member, .....

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..... y have filed civil appeals before the Hon'ble Supreme Court against aforesaid Tribunal orders and are still pending. Pending outcome of the decision of the Hon'ble Supreme Court, they started paying duty as per the Tribunal's order and worked out the value as per CAS-4 and paid the differential duty next month of every quarter. Therefore, there is no demand of interest. She submits that initially they have worked out the value as per their own method and calculated 110% of cost of production whereas the jurisdictional Superintendent of Central Excise has pointed that the CAS-4 value of the respective quarter has to be adopted for the determination of differential duty. Therefore, they have recalculated the CAS value and paid di .....

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..... r sub-section (2B) of Section 11A of Central Excise Act. I find that when appellant could not quantify the value as per CAS, they ought to have opted for provisional assessment. Instead they chose to pay differential duty for every quarter on self-assessment. Once the differential duty is paid it is covered under Section 11A (2B) and interest is automatic. In this regard, I rely on the Hon'ble Supreme Court's decision in the case of CCE Pune Vs SKF India Ltd. (supra) wherein the Hon'ble apex court on the identical issue held that once the duty is paid and the differential duty is covered under sub-section (2B) of Section 11A, interest is payable under Section 11AB. The relevant paras 9 to 15 of the said apex court judgement are .....

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..... ut the payment made by him and in that event he would not be given the demand notice under sub-section (1). But Explanation 2 to the sub-section makes it expressly clear that such payment would not be exempt from interest chargeable under Section 11AB, that is, for the period from the first date of the month succeeding the month in which the duty ought to have been paid till the date of payment, of the duty. What is stated in Explanation 2 to sub-section (2B) is reiterated in Section 11AB that states where any duty of excise has not been levied or paid or has been short levied or short paid or erroneously refunded, the person who has paid the duty under sub-section (2B) of Section 11A, shall, in addition to the duty, be liable to pay intere .....

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..... iately when the revised rates became known to them from their customers. The differential duty was due at that time i.e. when the revised rates applicable with retrospective effect were learnt by the Assessee, which was much after the clearance of the goods and therefore, question of payment of interest does not arise as the duty was paid as soon as it was learnt that it was payable. Finding that provisions of Section 11A (2) and 11A (2B) were not applicable as the situation occurred in the instant, case was quite different, Section 11AB (1) was not at all applicable, and therefore, the Assessee was not required to pay interest. 13. It further held that a case of this nature would not fall in the category where duty of excise was not p .....

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