Appellant not liable for interest on excise duty; duty payment obligation only at goods clearance.

The appellant was not liable to pay interest on central excise duty for the period July 2013 to October 2015. The court held that duty payment obligation arises only at the time of goods clearance, not at the agreement or certificate issuance stages. The demand for interest was deemed unsustainable, leading to setting aside the impugned order and allowing the appeal with any consequential relief.

---

---

Issues:
Whether the appellant is liable to pay interest on central excise duty for the period July 2013 to October 2015.

Analysis:
The case involved the appellants engaged in the manufacture of concrete electricity poles. The department alleged that the appellants had short-paid duty due to an agreement with TNEB including central excise duty, thus requiring payment at the agreement stage, not at clearance. A show cause notice was issued for interest on delayed duty payment. The original authority and Commissioner (Appeals) upheld the demand, leading to this appeal.

The appellant's counsel argued that central excise duty becomes payable only upon goods clearance, which the appellants had done timely. The department contended that duty payment was due at the agreement and certificate issuance stages, causing a delay. The department's stance was supported by the Additional Commissioner.

After considering both arguments, the sole issue was whether interest on central excise duty for July 2013 to October 2015 was justified. The department claimed delay due to the agreement and TNEB certificates including duty, but the taxable event for central excise duty is goods clearance. Therefore, the liability to pay duty arises only at clearance, not at agreement or certificate stage. Consequently, the demand for interest was deemed unsustainable, leading to setting aside the impugned order and allowing the appeal with any consequential relief.

In conclusion, the judgment clarified that the appellant was not liable to pay interest on central excise duty for the mentioned period, as the duty payment obligation arises only at the time of goods clearance, not at the agreement or certificate issuance stages.

---