WAIVER OF INTEREST IN CASE OF SHORT PAYMENT OF DUTY/SERVICE TAX

[RAM SHARMA]

Dear Experts,

As per Sec 11AA of CEA,1944 the interest has to be paid whether the relevant payment is ade voluntarily or after determination of the amount of duty under section 11A . in the same section there is a proviso that talks about waiver of interest in case of payment of duty within 45 days of order . i cant relate this proviso with the section . it confuses me regarding the point that 11AA interest is itself compulsory then how can lawmakers talk about its waiver in proviso ? please enlight me with proper interpretation . 

Thanks

[YAGAY andSUN]

This subsection (3) of the Section 11AA can't be read in isolation, it should be read alongwith the Section 37B of the CEA.

Since, the nature of interest is Statutory, hence it is mandatory to pay, in the event of any voilation of provisions of CE Laws where duty element is involved untill unless it pertain to order 37B.

AI Summary

Query on Section 11AA: Clarification on Interest Waiver Linked with Section 37B Orders under Central Excise Act, 1944. A participant raised a query regarding the interpretation of Section 11AA of the Central Excise Act, 1944, which mandates interest payment on duty, questioning how a waiver of interest is possible under the same section. An expert clarified that subsection (3) of Section 11AA should not be read in isolation but in conjunction with Section 37B of the Act. The expert explained that while interest is statutory and mandatory in case of duty violations, the waiver might apply when linked with orders under Section 37B.