Interest on delayed cess payments cannot be imposed without an express charging provision in the parent statute.

Interest on delayed payment of cess under the Oil Industry (Development) Act, 1974 was not leviable because the Act contained no express substantive provision authorising such interest. Although the cess is treated as a duty-of-excise type levy and the Central Excise Act and Rules apply for levy and collection so far as may be, those machinery and incorporative provisions could not create a new interest liability. Section 11AB of the Central Excise Act and Rule 8(3) therefore could not be invoked to impose interest, and the absence of any corresponding amendment in the charging statute reinforced that result.

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Issues: Whether interest on delayed payment of cess under the Oil Industry (Development) Act, 1974 could be levied by applying Section 11AB of the Central Excise Act, 1944 and Rule 8(3) of the Central Excise Rules.

Analysis: The levy under the Oil Industry (Development) Act, 1974 is a cess in the nature of duty of excise, and Section 15(4) applies the Central Excise Act and the Rules made thereunder only so far as may be, for levy and collection. The crucial question was whether interest for delayed payment is merely a procedural incident of collection or a substantive liability. Following the settled principle that interest can be charged only when the statute imposing the tax or cess makes a substantive provision for it, the Court held that the Oil Industry (Development) Act, 1974 contains no express provision authorising interest on delayed payment of cess. The incorporation of the Central Excise framework could not enlarge the charging statute so as to create a new liability for interest. The absence of a corresponding amendment in the Oil Industry (Development) Act, 1974 when interest provisions were introduced into the Central Excise law reinforced this conclusion.

Conclusion: Interest was not leviable on delayed payment of cess under the Oil Industry (Development) Act, 1974 by invoking Section 11AB of the Central Excise Act, 1944 or Rule 8(3) of the Central Excise Rules.

Ratio Decidendi: Interest on tax or cess can be imposed only by an express substantive provision in the charging statute, and machinery or incorporative provisions cannot by themselves create such liability.

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