TaxTMI 
TaxTMI 
2016 (1) TMI 479
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....e Final Order No.1899/09, dated 09.12.2009. Brief facts:- 2. M/s. Lucas TVS Ltd., / assessee / respondent herein is the manufacturers of 'Wiper Motor Assembly', (in addition to other goods) falling under Tariff Heading No.8512.00. The Revenue classified the same under Tariff Sub Heading No.8501.00. There was a difference in the rate of excise duty between the Tariff Sub-Heading No.8501.00 and 8512.00, and the difference specifically was that, Tariff on Sub-Heading No.8512.00 was higher. Hence, after hearing, Order-in-Original (O-in-O) No.7/95, dated 09.01.1995, was passed, directing the respondent herein to pay a sum of Rs. 34,30,799/-, (Rs.2,38,538/-, for the period from 01.01.1994 to 31.01.1994, Rs. 13,26,752/- for the perio....
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....rest payable was worked out under Section 11AA of the Act, with effect from 26.08.1995 onwards, i.e., from the date on which the Finance Bill, 1995, got the approval of the President. The interest amount of Rs. 40,44,772/- was demanded under Range Office Letter O.C.No.1078/2001, dated 24.02.2001, and Order-in-Original No.31 of 2001, dated 29.11.2001, was passed by the JAC (Joint Action Council). In the Order-in-Original, the JAC confirmed the demand of Rs. 40,21,272/-, being the interest payable for the duty amount of Rs. 34,30,799/-, as determined in Order-in-Original No.9 of 1995, dated 09.01.1995, under Section 11AA of the Act. 2.5. As against the order, dated 09.01.1995, the respondent filed an appeal before the Commissioner (Appeals....
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.... delayed payment of duty and more specifically on the date from which the interest is payable. The incidental / consequential question to be considered is, when the duty becomes payable, i.e., whether, as on the date when the duty becomes due or the date of the original order, determining the liability, or as on the date of the subsequent orders, either reducing or enhancing the tax liability. The relevant section dealing with 'Interest on delayed payment of duty' is Section 11AA of the Act, which stood, before substitution by the Act 8 of 2011, reads as under:- " '11AA. Interest on delayed payment of duty.- (1) Subject to the provisions contained in Section 11AB, where a person chargeable with duty determined under sub....
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.... payable, the date on which the duty is so determined; (b) for the amount of increased duty, the date of order by which the increased amount of duty is first determined to be payable; (c) for the amount of further increase of duty, the date of order on which the duty is so further increased. (2) The provisions of sub-section (1) shall not apply to cases where the duty becomes payable on and after the date on which the Finance Bill, 2001 receives the assent of the President." 4.1. Under this Section, duty is payable after the expiry of three months from the date of determination of duty. In a case where the duty is determined prior to coming into force of this provision, the proviso lays down t....
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....rted in Section 11AA on 11th May, 2001." 6. From the reading of the above decision (Blue Star Limited's case, cited supra), it is clear that, duty is payable only when the liability is ascertained and that the liability to pay interest arises only on the determination of that duty / liability and also if the ascertained duty is not paid within a period of three months from the date of ascertainment. 7. Therefore, the contention of the Revenue that the determination of duty liability takes effect from the date on which the liability arises and not from the date, on which, the order of termination is passed, is incorrect and is liable to be rejected. 8. So far as this case is concerned, the contention of the learned counsel for t....