2015 (9) TMI 149

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....ve of Articles 14, 19(1)(g), 50 and 265 of the Constitution of India and also to set aside the consequent demand. 2. In all the above Writ Petitions, the issue that arise for consideration is whether interest is chargeable in terms of Rule 8(3) Central Excise Rules or under the provisions of Section 11AB of the Central Excise Act. 3. It is submitted by both the learned counsel appearing for the petitioners as well as the learned Standing Counsel appearing for the respondents that the issue involved in these Writ Petitions is covered by a decision of the Rajasthan High Court in the case of 2006 (200) E.L.T. 377 (Raj.) (Lucid Colloids Limited V. Union of India), wherein the Rajasthan High Court held that Rule 8(3) of the Central Excise ....

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....he charge of interest cannot be made payment of interest at monthly rates. Interest rate @ 2% per month can only be read as 24% per annum. Providing alternative levy of interest Rs. 1,000/- per day, if it is higher than the interest chargeable at the rate prescribed, is clearly by way of penalty and contrary to enabling power conferred on Rule Making Authority under Section 11AB of the Act. 11. Section 11AB clearly relates to charge of rate of interest related to amount in default for the period, the assessee remains in default of payment. Permitting charge of interest at the rate of Rs. 1,000/- per day is not computable in relation to amount of Duty in default. Whether Rs. 1,00,000/- is not paid in time or Rs. 1,000/- is not paid in tim....