Interest Liabilities on rate increased

[Pradeep Jain]

Sir,

We do supply automobile components  on the bais of PO where is rate and quantity are mentioned. However, we use to get  rate increases from th e said Customer from past period . For  getting the increased value of the past period, a supplimentary invoice is issued by the Company and appropriate  differential excise duty  is paid thereon.

Our Query is that:-

Do we need to pay interest on the differencial excise duty , as above, paid by the company. ?

 

Pl. give us your Expert Legal Opinion.

 

Regards

 

Pradeep Jain

[YAGAY and SUN]

It has been clarified that if differential dut is paid later, interest under Section 11AB will be payable for differential amount paid later, as section 11AB includes provision for payment of interest when differential duty is paid under Section 11AB(2B)- MF (DR) letter 0574/CE/5/Misc/203 dated 28-07-2003.

 

[Sanjay Sharma]

Dear Pradeepji,

Interest payable on differenttial duty when price revised later -Supreme Cour of India.

Leviability of interest on differential duty confrimed by the Apex Court in - Commissioner of Central Excise, pune v. SKF India Ltd- 2009(239 E.L.T. 385 (S.C) = 2009 (7) TMI 6 - SUPREME COURT

Regards,

Sanjay Sharma

AI Summary

Interest on differential excise duty is payable where such duty is remitted late, confirmed by higher authority.
Interest is payable on differential excise duty when duty is paid belatedly following issuance of supplementary invoices to recover higher prices. Administrative guidance applies the statutory interest provision to such delayed differential payments, and the highest appellate authority has affirmed that interest is leviable on differential excise duty paid after the original period.