Petitioner to Prove Delayed Interest Receipt for Excise Duty Exclusion

The Court directed the petitioner to provide evidence that interest on sold commodities was received after the stipulated period. The assessing authority was instructed to consider this evidence in line with Supreme Court decisions. The petitioner was given the opportunity to file a fresh representation, and the assessing authority was required to decide after a hearing. The petition was disposed of with no costs, emphasizing the need for evidence to potentially exclude interest from excise duty.

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Issues:
Petition for quashment of show cause notice and seizure memo, legality of Circular No. 194/28/96-CX.

Analysis:
The petitioner, a public limited company manufacturing explosives, sought to exclude interest component from excise duty based on Supreme Court decisions. The Circular issued by the Central Board of Excise and Customs was challenged as contradictory to established law. The petitioner contended that interest being receivable, excise duty should not apply. The Superintendent of Central Excise was urged to consider this argument but instead issued a show cause notice for penalty and seizure.

The respondents argued that the Supreme Court's earlier decision had been reviewed and interest on receivables was to be paid only after 21 days as per the terms of payment. The department requested evidence from the petitioner to show that payments were received after the stipulated period, which the petitioner failed to provide. The Court noted that if such evidence is presented, the interest could be excluded from excise duty as per the law.

The Court directed the petitioner to appear before the assessing authority with evidence that interest on the sold commodities was received after the stipulated period. The assessing authority was instructed to consider this evidence and pass appropriate orders in line with the Supreme Court's decisions. The petitioner was given the opportunity to file a fresh representation and the assessing authority was required to decide after providing a hearing to the petitioner.

In conclusion, the petition was disposed of with no costs, emphasizing the need for the petitioner to provide evidence to support their claim regarding the timing of interest payments to potentially exclude it from excise duty.

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