Provisional assessment interest runs from the clearance date, not final assessment, when differential excise duty is later found due.

In provisional assessment cases under excise law, interest on differential duty accrues from the date the duty became payable for clearance of the goods, not from the date of final assessment. The Court applied the earlier three-Judge Bench ruling and held that later crystallisation of the differential duty does not shift the commencement of interest liability. The result was that interest was payable from the due date for the provisional duty until payment of the balance duty on final assessment, and the issue was decided against the assessee.

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Issues: Whether interest on differential excise duty was payable from the date of clearance of goods, where duty had been provisionally assessed and paid before the final assessment.

Analysis: The issue was treated as covered by the earlier three-Judge Bench ruling on provisional assessment and interest. It was held that where duty is provisionally paid on clearance of goods and the final assessment subsequently discloses a differential duty, interest follows from the date when the duty ought to have been paid for removal of the goods and not from the date of final assessment. The later crystallisation of the differential duty does not alter the time at which the liability to pay interest arises.

Conclusion: Interest on the differential duty was payable from the due date for payment of the provisional duty till the date of payment of the balance duty upon final assessment, and the issue was answered against the assessee.

Final Conclusion: The petition was disposed of by applying the settled rule that interest accompanies the delayed payment of duty from the relevant clearance date in cases of provisional assessment.

Ratio Decidendi: In provisional assessment cases, interest on differential duty runs from the date the duty became payable for clearance of the goods and not from the date of final assessment.

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