Notification inapplicability barred interest demand; omission in the prior order was rectified in favour of the assessee.

Where goods were held to fall outside Notification No. 110/95 because differential duty had already been paid, no interest could be demanded under that notification. The omission in the earlier final order to record the consequence on interest was treated as material, because it could have enabled recovery of interest despite the finding on non-applicability of the notification. The prior order was therefore rectified, and interest at 24% was held not payable.

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Issues: Whether interest at 24% was payable when the goods were held to go outside the purview of Notification No. 110/95, and whether the omission in the earlier final order required rectification.

Analysis: The application sought correction of the earlier final order on the ground that, although the goods were held to fall outside the notification because differential duty had already been paid, the order omitted to state the consequence on interest. The omission was material because the department could seek recovery of interest despite the finding that the goods were outside the scope of the notification. Once the goods were held to be outside the purview of the notification, no interest could be demanded under that notification.

Conclusion: Interest at 24% was held not payable, and the omission was rectified in favour of the assessee.

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