Tribunal rules no interest on duty demand, citing precedent. Compliance with payment methods key.

The Tribunal set aside the demand of interest under Rule 173(G)(1)(d) of Central Excise Rules, 1944, amounting to Rs.33,12,883/-, as the appellants paid duty first through CENVAT Credit account and later from PLA during the specified period. Citing the precedent in Noble Drugs Ltd. case, the Tribunal ruled that failure to comply with duty payment methods during the forfeiture of the fortnightly payment facility does not warrant interest or penalty. The decision emphasized adherence to legal provisions and established precedents in resolving duty payment disputes.

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Issues:
Appeal against demand of interest under Rule 173(G)(1)(d) of Central Excise Rules, 1944 where duty is paid through CENVAT Credit account and subsequently from PLA.

Analysis:
The appellants contested the demand of interest of Rs.33,12,883/- under Rule 173(G)(1)(d) of Central Excise Rules, 1944. The main issue revolved around the payment of duty through CENVAT Credit account as directed by the department during the period of withdrawal of fortnightly payment facility, followed by payment from PLA. The appellants argued that their case aligns with the decision of the Larger Bench in the case of Noble Drugs Ltd. The Tribunal examined the cited decision and noted that an assessee can discharge duty liability either from PLA or by utilizing CENVAT credit during the period of forfeiture of the facility of fortnightly duty payment. Failure to do so, as per the Larger Bench, does not attract interest and penalty. Consequently, the Tribunal found no merit in the impugned order and set it aside, allowing the appeals with any consequential relief. The issue was deemed settled based on the precedent set by the Noble Drugs Ltd. case.

This analysis highlights the core issue of interest payment under Rule 173(G)(1)(d) of Central Excise Rules, 1944 when duty is paid first through CENVAT Credit account and later from PLA. The Tribunal's decision was influenced by the precedent established in the Noble Drugs Ltd. case, emphasizing the permissibility of discharging duty liability through either PLA or CENVAT credit during the specified period. The judgment underscores the importance of adherence to legal provisions and established precedents in resolving disputes related to duty payment mechanisms and interest obligations.

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