Interest and penalty under Central Excise law require prior duty determination; without Section 11A proceedings, they cannot stand.

Interest and penalty under Central Excise law were stated to depend on prior adjudication and determination of duty under Section 11A. The cited precedent was applied to indicate that Sections 11AC and 11AB operate only where evasion of duty has first been determined under Section 11A, and that penalty under Rule 173Q also cannot be imposed without such proceedings. In the absence of any duty demand or determination under Section 11A, the demand of interest and the penalty were treated as unsustainable, and the appeal was allowed.

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Issues: Whether interest and penalty under the Central Excise law could be sustained in the absence of any determination of duty under Section 11A.

Analysis: Liability to interest and penalty was held to depend upon prior adjudication and determination of duty under Section 11A. The cited precedent was applied to hold that Sections 11AC and 11AB operate only where evasion of duty has first been determined under Section 11A, and that penalty under Rule 173Q also cannot be imposed without such proceedings.

Conclusion: The demand of interest and the penalty were unsustainable in the absence of any duty demand or determination under Section 11A, and the appeal was allowed.

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