TMI Blog2017 (3) TMI 412X X X X Extracts X X X X X X X X Extracts X X X X ..... hese reasons, we hold that the demand for interest in terms of the Central Excise Act, 1944 was not tenable - petition allowed - decided in favor of petitioner. - Writ Petition No. 1856 of 1999 - - - Dated:- 20-2-2017 - S. C. Dharmadhikari And B. P. Colabawalla, JJ. Mr. Vishal Kanade a/w Mr. Dhruv Joshi i/b. M/s. Wadia Ghandy Co. for the Petitioners Mr. Swapnil Bangur a/w Mr. Joel Carlos for the Respondents ORDER P. C. 1. By this petition under Article 226 of the Constitution of India, the petitioners challenge the demand for interest under Section 11AA of the Central Excise Act, 1944 as the provision then stood, and seek a consequential relief of quashing and setting aside the order of the 2nd and the 3rd respondent dated 25th April 1997 and 19th March 1999. 2. It is common ground that the petitioner No.1 is a Company incorporated under the provisions of the Indian Companies Act, 1956. The petitioners challenge an order of attachment dated 25th April 1997 and a further order dated 19th March 1999 which orders are passed by respondent nos. 2 and 3, respectively, to this Writ Petition. 3. The petitioners do not dispute that they had filed a Writ Pet ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... case. 5. That stand having been negatived and the attachment order resulting from the non-payment of interest as well, that this Writ Petition has been filed. The petitioners, in the meanwhile, have instituted several proceedings. They thought that they have a remedy to challenge the order of attachment and the demand for interest but the appellate proceedings were held to be not maintainable. Eventually, this Writ Petition was filed and in which we see that the petitioners were called upon to pay the amount of interest demanded. That was to be deposited in this Court and later on, the same was directed to be invested in a Nationalized Bank. 6. It is not disputed that this amount is already deposited in this Court and duly invested. 7. Mr. Kanade appearing on behalf of the petitioners raised only one contention for our consideration. He would submit that Section 11AA of the Central Excise Act, 1944 had no application. There, the interest and contemplated on delayed payment of duty follows the determination under Section 11A(2) and if that determined sum is not paid within three months from the date of determination, then, it carries interest at the rate specified in Sectio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hargeable with duty determined under subsection (2) of section 11A, fails to pay such duty within three months from the date of such 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 duty from the date immediately after the expiry of the said period of three months till the date of payment of such duty: PROVIDED that where a person chargeable with duty determined under subsection (2) of section 11A before the date on which the Finance Bill, 1995 receives the assent of the President, fails to pay such duty within three months from such date, then, such person shall be liable to pay interest under this section from the date immediately after three months from such date, till the 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 determin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... from the Range Superintendent calling for payment of such duty on the basis that it is duly collected by the petitioner but not remitted, forgetting that there was a stay operating in favour of the petitioners. Hence, we are not concerned with the period during which the Writ Petition was pending before the Delhi High Court. After it was disposed of, a demand has been made for payment of duty. That duty was paid, may be in installments, as recorded in the order dated 4th September 1997 but it was paid. Once we are only concerned with the order passed on 4th September 1997 that may be determining the sum due and payable, but it records that the sum has already been paid. Therefore, the ingredients or the first part of Subsection (1) of Section 11AA are not attracted to the facts of the present case. There was no determination by the order passed on 4th September 1997 and in any event the sum due and payable post such determination was already paid within any time limit but in installments and prior to 4th September 1997. It is only when an eventuality within the meaning of Section 11AA occurs that the interest under Section 11AA becomes payable. Such is not the case from the facts a ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
