TaxTMI 
TaxTMI 
2011 (10) TMI 162
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....ufacturers of motor-vehicles and they are clearing excisable goods such as jigs & fixtures, dies & tools etc. to their sister unit at Jamshedpur, Lucknow etc. and to their vendors. The duty liability was discharged on provisional basis in terms of rule 7 of the Central Excise Rules, 2002 inasmuch as the accounts of the appellants were not finalized. Subsequently on finalization of accounts, the appellants submitted the data to the department and the assessments were finalized vide order dated 9.5.2008. However, the assessee on their own discharged the differential duty liability on 30.09.2007 and 05.10.2007 on the basis of data which they have supplied to the department forfinalization of the assessment. The department apart from the confir....
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....to pay the interest and the department has taken up the matter in appeal before the Hon'ble High Court. Therefore, the department prays for setting aside the order of the lower appellate authority and restoration of the order passed by the original adjudicating authority. 4. The learned Counsel for the respondents submits that the respondents had filed the Central Excise Appeal no. 114 of 2010 and 115 of 2010 in the matter, which was decided by the Hon'ble High Court on 12.10.2010 and the Hon'ble High Court remitted the matter back to the Tribunal with the following directions:- (i) The appellants have failed to take cognizance of the fact that in the instant case the interest was levied by the Dy. Commissioner in Order-in-Original da....
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....f provisional assessment, the date of provisional and final assessments have no relevance in deciding payment of interest; if duty finally determined is not paid on due date, it is short paid and assessee is liable to pay not only balance of duty but also interest. In case the duty has been paid prior to finalization then also the liability to pay interest does not get extinguished and interest has to be discharged on delayed payment of duty. 6. The learned Counsel for the appellant in his rejoinder submits that in case there are conflicting decisions passed by two different High Courts, then the sub-ordinate officers have to follow the decision of their own High Court and relies on the judgment of the Tribunal in the case of U.P. Lamina....
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....ustries Ltd. (supra) had held that in a case where differential duty was paid prior to the date of finalization of assessment, then no interest is payable in terms of the provisions of Rule 7(4) of the Central Excise Rules, 2002. However, the Hon'ble High Court of Karnataka in the J.K.Industries case (cited supra) has held a contrary view. The Hon'ble High Court of Karnataka has held that in the case of provisional assessment, the date(s) of provisional and final assessment have no relevance in deciding payment of interest and if duty finally determined is not paid on due date, it is short paid and the assessee is liable to pay not only balance of duty but also interest. In case the duty has been paid prior to finalization then also the lia....
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.... contemplated under the Rules." In other words, the Apex Court has held that under Rule 9B, there is no question of self-assessment and payment of duty on the basis of such assessment and the finalization of assessment is undertaken by the Central Excise officer and upon such finalization, the duty liability is determined and is to be discharged. The same principle would apply in respect of rule 7 also. Therefore, the payment of differential duty liability by the assessee on their own does not arise at all and the duty liability is to be determined by the Central Excise Officer whereupon the assessee is required to discharge the differential duty liability. In a case where the assessee pays the differential duty before finalization of as....