Interest on delayed cess payment requires express statutory authority; coercive recovery stayed pending writ petition.

Interest on delayed payment of cess under the Oil Industry (Development) Act, 1974 was treated as requiring express substantive statutory authority, and the Act contained no such express interest provision. The Central Excise Act and rules were relevant only to the extent applicable to levy and collection machinery, while the 1988 circular contemplated reconciliation of quantities and final assessment. Applying the distinction between a charging or interest provision and procedural machinery, the Court found a prima facie case for interim protection and restrained coercive recovery of the demanded interest pending disposal of the writ petition.

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Issues: Whether, pending the writ petition, the authorities could recover interest on delayed payment of cess by relying on the Central Excise Rules and whether the Oil Industry (Development) Act, 1974 contained a substantive provision authorising levy of such interest.

Analysis: The cess on crude oil is levied under Section 15 of the Oil Industry (Development) Act, 1974, and the Act itself does not contain any express provision for levy of interest on delayed payment. The provisions of the Central Excise Act and the rules made thereunder are attracted only as far as may be in relation to levy and collection, and the procedure indicated in the 1988 circular contemplated reconciliation of quantities and finalisation of assessment. In view of the distinction between a substantive charging or interest provision and procedural machinery, and applying the principle that interest cannot be levied in the absence of substantive statutory authority, a prima facie case was made out for interim protection.

Conclusion: The respondents were restrained from taking coercive steps to recover the demanded interest pending disposal of the writ petition, and the interim protection was granted in favour of the petitioner.

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