TMI Blog2003 (8) TMI 60X X X X Extracts X X X X X X X X Extracts X X X X ..... s around the notice of demand issued on 5-7-1991 whereunder a demand was raised on the petitioner by the Revenue authorities in respect of the custom duty as well as interest payable on the custom duty. It is the contention of the respondents that interest on custom duty was payable by the petitioner for the period 16-6-1989 to 5-7-1991, in the first instance and thereafter, from 5-7-1991 till the date the goods were cleared from the warehouse. The Customs authorities by virtue of the said notice of demand dated 5-7-1991 computed the interest on customs duty for the first period i.e. 16-6-1989 to 5-7-1991 at Rs. 2,22,808/-. For the subsequent period, the notice of demand indicated that interest would be charged at the rate of Rs. 265/- per ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... is that the notice of demand does not specify any period within which the amount mentioned in the demand is to be paid. In such a situation, it is to be construed that the amount specified in the notice of demand would become payable immediately, i.e., on the date of the notice of demand, which is 5-7-1991. 4.The present case is entirely covered by the aforesaid decision of the Supreme Court in the case of Bangalore Wire Rod Mill (supra). Accordingly, the notice of demand, to the extent it raises a demand of interest for the period 16-6-1989 to 5-7-1991 will have to be set aside. This is so because no amount would be due until the notice of demand was issued and served upon the petitioner. When the principal amount itself would not be du ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... that would be relevant and applicable. Accordingly, interest also would become payable from 5-7-1991 itself being the date of the notice of demand. Interest cannot be charged from the petitioner for any period prior to 5-7-1991. 6.In view of the aforesaid discussion, the impugned notice of demand dated 5-7-1991 inasmuch as it provides for interest for the period from 16-6-1989 to 5-7-1990 is hereby quashed and set aside. To this extent, the writ petition is allowed. On the payment of the interest amount due for the period 5-7-1991 to 13-7-1991, which the petitioner ought to do within a week from today, the bank guarantees furnished and kept alive during the pendency of the present matter would stand discharged. This writ petition is accor ..... X X X X Extracts X X X X X X X X Extracts X X X X
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