Interest payable under Central Excise Law for delayed payments. Tribunal remands time-barred demand issue for review.

The appellate tribunal upheld that interest is payable under Central Excise Law when monthly payments are not made as per Rule-6(3A) of CCR. The tribunal also remanded the issue of the demand being time-barred to the Adjudicating Authority for further consideration, directing a denovo review in light of relevant Case Laws.

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Issues:
1) Whether interest is payable under Central Excise Law when monthly payments are not made but the entire payment for the financial year is paid subsequently within the specified due date under Rule-6(3A) of CCR.
2) Whether the demand of interest is time-barred when no extended period has been invoked in the Show Cause Notice.

Analysis:

Issue 1:
The appellant argued that they were engaged in manufacturing both dutiable and exempted goods and availed Cenvat Credit on inputs under Cenvat Credit Rules 2004. They contended that they reversed proportionate Cenvat Credit for input Furnace Oil used in manufacturing exempted goods by the end of the financial year. The appellant claimed that the demand for interest was time-barred as no extended period was invoked in the Show Cause Notice. The authorized representative, however, argued that a provisional amount was required to be reversed each month under Rule-6(3A) of CCR based on previous years' consumption of Furnace Oil for exempted goods. The appellate tribunal noted that if the entire differential amount is not paid by the due date, interest on the differential amount is required to be paid as per Rule 6(3A)(e) of CCR. The tribunal upheld the decision that interest is payable when monthly payments are not made, and the appellant cannot avoid payment of interest under Rule 6(3A)(e) of CCR.

Issue 2:
Regarding the time-barred nature of the demand of interest, the tribunal observed that neither of the lower authorities addressed this issue when raised in the appellant's prayers. As a result, the tribunal remanded the issue to the Adjudicating Authority for denovo consideration. The Adjudicating Authority was directed to decide on the time-barred nature of the demand in light of the relied-upon Case Laws and provide the appellant with a personal hearing to explain their case. The appeal was allowed by way of remand solely on the issue of time-barred demand.

In conclusion, the appellate tribunal upheld the decision that interest is payable under Central Excise Law when monthly payments are not made as required by Rule-6(3A) of CCR. However, the issue of the demand being time-barred was remanded to the Adjudicating Authority for further consideration.

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