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2016 (1) TMI 479 - MADRAS HIGH COURT

2016 (1) TMI 479 - MADRAS HIGH COURT - 2016 (333) E.L.T. 259 (Mad.) - Levy of interest on differential duty - scope of Section 11AA before 11-5-2001 - Whether the CESTAT has not erred in law in holding that duty liability arises and commences from the date of the order of determination and not from the date of the actual liability especially when an order of determination always dates back to the actual date of liability? - Held that:- So far as this case is concerned, the contention of the lea .....

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the duty has been paid by the assessee, the question of payment of interest does not arise.

The demand made for interest for the period from 26.08.1995 to 31.03.2001 has been rightly rejected by the Commissioner (Appeals) and as well as by the CESTAT, Chennai, is perfectly valid and is in accordance with the judgment rendered in Blue Star Limited's case [2009 (10) TMI 257 - BOMBAY HIGH COURT] - Decided against the revenue. - Civil Miscellaneous Appeal No.2732 of 2010 - Dated:- 10-12- .....

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TVS Ltd., / assessee / respondent herein is the manufacturers of 'Wiper Motor Assembly', (in addition to other goods) falling under Tariff Heading No.8512.00. The Revenue classified the same under Tariff Sub Heading No.8501.00. There was a difference in the rate of excise duty between the Tariff Sub-Heading No.8501.00 and 8512.00, and the difference specifically was that, Tariff on Sub-Heading No.8512.00 was higher. Hence, after hearing, Order-in-Original (O-in-O) No.7/95, dated 09.01.19 .....

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inal No.7/95, dated 09.01.1995, the respondent herein appealed before the Commissioner (Appeals). The Commissioner (Appeals), vide his Order-in-Appeal (O-in-A) No.128 and 129 of 1995 (M), dated 20.06.1995, set-aside the Order-in-Original No.7 of 1995, dated 09.01.1995 and confirmed the classification of the said goods under T.S.H.No.8501.00. 2.2. As against the above order, the appellant / Revenue filed an Appeal before the CESTAT, Chennai. The CESTAT, vide its Order Nos.395 and 396/1997, dated .....

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efore the date, on which, the Finance Bill, 1995, got the assent of the President. The assent of the President for the Finance Bill, 1995, was accorded on 26.08.1995. 2.4. The interest payable was worked out under Section 11AA of the Act, with effect from 26.08.1995 onwards, i.e., from the date on which the Finance Bill, 1995, got the approval of the President. The interest amount of ₹ 40,44,772/- was demanded under Range Office Letter O.C.No.1078/2001, dated 24.02.2001, and Order-in-Origi .....

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9 of 2002 (M-11), dated 20.12.2002, set-aside the Order-in-Original No.31 of 2001, dated 29.11.2001. Against the above Order-in-Appeal No.189 of 2002 (M-11), dated 20.12.2002, the Revenue had filed an appeal before the CESTAT. The CESTAT, in its final Order No.1899 of 2009, dated 09.12.2009, had relied upon an order of the Bombay High Court, in the case of Blue Star Limited v. Union of India and others, reported in 2009-TIOL-HC-MUM : 2010 (250) E.L.T. 179 (Bom.) and upheld the impugned order and .....

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duty liability arisen prior to introduction of Sec.11AA? and 2. Whether the CESTAT has not erred in law in holding that duty liability arises and commences from the date of the order of determination and not from the date of the actual liability especially when an order of determination always dates back to the actual date of liability? 4. The issue involved, in this appeal, relates to the interest payable on delayed payment of duty and more specifically on the date from which the interest is p .....

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Interest on delayed payment of duty.- (1) Subject to the provisions contained in Section 11AB, where a person chargeable with duty determined under sub-section (2) of Section 11-A, fails to pay such duty within three months from the date of determination, he shall pay, in addition to the duty, interest at such rate not below ten per cent and not exceeding thirty-six per cent, per annum, as is for the time being fixed by the Central Government, by notification in the Official Gazette on such dut .....

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he date of payment of such duty. Explanation 1.- Where the duty determined to be payable is reduced by the Commissioner (Appeals), Appellate Tribunal, National Tax Tribunal or, as the case may be, the Court, the date of such determination shall be the date on which an amount of duty is first determined to be payable. Explanation 2.- Where the duty determined to be payable is increased or further increased by the Commissioner (Appeals), Appellate Tribunal, National Tax Tribunal or, as the case ma .....

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d after the date on which the Finance Bill, 2001 receives the assent of the President. 4.1. Under this Section, duty is payable after the expiry of three months from the date of determination of duty. In a case where the duty is determined prior to coming into force of this provision, the proviso lays down that interest would be payable after the expiry of three months from the date on which the Finance Bill, 1995, received the presidential assent. 5. Section 11AA of the Act, came to be interpre .....

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determination and/or ascertainment of duty. The relevant date for commencement of time, the interest would be from the date the duty is determined if not paid within three months. Once there be an order, setting aside the entire order of determination there is no ascertained duty payable. In the instant case, therefore, though there was original order passed on 14th June, 1993 that was set aside on 14th July, 2000. The matter was before the A.O., for fresh determination on which an order came t .....

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