Statutory interest on delayed excise duty follows the duty liability and is not defeated by a limitation plea.

Statutory interest attaches to delayed payment of central excise duty where the differential duty becomes payable after valuation adjustment under Rule 8 of the Central Excise Valuation Rules, 2000. The admitted delay in duty payment brought the assessee within the interest provision, and recovery of interest was treated as a direct consequence of the duty liability without requiring separate adjudication. The plea that limitation barred recovery of the interest was rejected because limitation does not apply to recovery of statutory interest. The cited decisions were distinguished on different facts involving sale and supplementary invoices, leaving the interest demand intact.

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Issues: Whether interest under Section 11AB of the Central Excise Act, 1944 was payable on delayed payment of differential duty arising under Rule 8 of the Central Excise Valuation Rules, 2000, and whether limitation barred recovery of such interest.

Analysis: The delay in payment of duty was admitted. The valuation under Rule 8 required adjustment after the financial year, but that circumstance did not take the case out of the statutory scheme for interest on delayed duty. Recovery of interest was treated as flowing directly from the duty liability, and no separate adjudication was considered necessary for its recovery. The plea of limitation was rejected on the basis that limitation does not apply to recovery of statutory interest. The Tribunal also declined to follow the cited decisions granting relief, and held the reference to the Larger Bench issue to be on different facts involving sale and supplementary invoices.

Conclusion: Interest under Section 11AB of the Central Excise Act, 1944 was held payable on the delayed differential duty, and the limitation plea was rejected.

Final Conclusion: The appeal failed and the order confirming interest on the delayed duty payment was sustained.

Ratio Decidendi: Where duty payment is admittedly delayed, statutory interest attaches to the duty liability and is recoverable without being defeated by limitation.

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