TaxTMI 
TaxTMI 
2017 (4) TMI 936
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....ndents. 3. After adjudication an amount of Rs. 6,20,103/- was confirmed as differential duty for the period 6/1990 to 5/1994 vide Order-in Original No. 4/97 (C.No.V/15/33/94-Adj) dated 30.04.2007. An amount of Rs. 4,12,050/- was confirmed for the period 6/1994 to 11/1995 vide Order-in-Original No. 5/96 (DC) (C.No.V/15/1/96-Adj) dated 04.12.1996. In each of the orders an amount of Rs. 50,000/- was imposed as penalty under Rule 173Q of Central Excise Rules, 1944. 4. The respondent herein preferred appeals against the said orders. Against the order confirming demand of Rs. 4,12,050/- an appeal was filed before the Commissioner (Appeals) and vide Order-in-Appeal dated 05.01.2001 the Commissioner (Appeals) upheld the demand and penalty. Against the order confirming demand of Rs. 6,20,103/- an appeal was preferred before the Tribunal and the Tribunal vide order dated 01.08.2003 remanded the matter for denovo adjudication. Thereafter, vide Order-in-Original dated 31.12.2003 denovo order was passed confirming the duty again to be Rs. 6,20,103/- along with same penalty. 5. The department then issued notice dated 28.12.2005 under the provisions of Customs (Attachment of property of defaul....
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.... to mention the grounds taken by the respondent challenging the liability of interest before the Assistant Commissioner which is reproduced as under: 1. The interest provisions under Section-11AA of CE Act, 1944 are in force only with effect from 26-05-1995, hence interest is not payable. 2. The demand of interest was not mentioned in the Show Cause Notices or Adjudication orders. 3. The worksheet in respect of quantification of interest was not furnished. 9. The discussion made by the Assistant Commissioner with regard to the liability of interest is also noticed as under as it would throw light regarding the law relating to liability of interest during the relevant period: "In response to the above representation, the Superintendent of Central Excise, Range-IIIC, Visakhapatnam has informed vide O.C.No.396/2006, dated 30-11-2006 that Section-11AA(1) of Central Excise Act clearly speaks that interest is chargeable on duty if the assessee doesn t pay the duty demanded within three months from the date of such determination of duty. So, the relevant date is the date of determination of duty but not the date / period during which the goods in question are involved. In the pre....
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....confirming the duty of Rs. 6,20,103/- was remanded by the Tribunal and denovo order was passed. Even in such remand order, the duty earlier confirmed has been reconfirmed by the denovo adjudication authority. That therefore, the Commissioner (Appeals) ought not to have considered the date of denovo adjudication order (31.12.2003) as the relevant date for computing the date of determination of duty. (iii) In any case, since the order confirming Rs. 4,12,050/- dated 04.12.1996 having not been remanded, the said date has to be considered date of determination of duty for calculating the liability of interest under Section 11AA of the Central Excise Act, 1944. (iv) It is also argued by the Ld. AR that the Commissioner (Appeals) has erred in holding that the order dated 04.12.1996 passed by the adjudicating authority confirming duty of Rs. 4,12,050/- has merged with the Commissioner (Appeals) order dated 05.01.2001 and therefore the relevant date of determination of duty is the date of appellate order which is 05.01.2001. 13. None appeared on behalf of the respondent though notice was issued. The case has been adjourned several times and even then the respondents have not bothered ....
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....nt of duty is first determined to be payable; (c) for the amount of further increase of duty, the date on which the duty is so further increased." The relevant provision contained in sub-section (2) of 11AA is noticed as under: "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." 16. Admittedly, there was no demand of interest in the show cause notice and there was no confirmation of liability to pay interest in the adjudication order also. As there was confusion in the law regarding the liability to pay interest, Section 11AA was introduced. The first proviso to this section speaks about liability to pay interest on all orders passed prior to 1995, if not paid within three months of the date of determination of duty. Explanation (1) and (2) explains how the date of determination of duty is to be reckoned. These explanations deal only with date of determination of duty when the demand is reduced or increased in further stage of appeal. It does not speak of a situation of remand, or a situation where the duty determined is maintained by the appella....
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.... effect that Section 11AA is not applicable to the facts of this case. After consulting the provisions of Section 11AA, I accept this contention. Sub-section (2) of Section 11AA reads as under :- "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." The Order-in-Original was passed on 1-5-2002. In other words, the assessee s liability was determined on that date. The appellant has invoked sub-section (1) of Section 11AA for demanding interest from the respondent. But the provisions of the sub-section are not applicable to the present case in which duty [by way of denial of Modvat credit] became payable only on 1-5-2002 [i.e. after the Finance Bill, 2001 received the assent of the President]. The demand on interest fails. In the judgment relied upon by the Commissioner (Appeals) as stated supra, the situation was similar wherein there was no demand of interest in the show cause notice. 19. The argument of the department, that in respect of demand Rs. 4,12,050/-, the date of determination of duty, is the date of original adjudication i.e. 04.12.199....
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....Explanation, therefore, gives the intent of the Legislature. The intent of the Legislature appears to be that in a case of increase of duty, the increased tax becomes payable not from the original date, but from the date on which it is increased and in the case of reduction it relates back to the first date. 117. What is the effect of setting aside the original order and remanding the matter for de novo consideration. Setting aside an order would mean that there is no order and a party is relegated to fresh adjudication. The stage of an adjudication cannot be said to be a determination. An adjudication will culminate in an order. That order would be the determination and/or ascertainment of duty. The relevant date for commencement of time the interest would be from the date the duty is determined if not paid within three months. Once there be an order, setting aside the entire order of determination there is no ascertained duty payable. In the instant case, therefore, though there was original order passed on 14th June, 1993 that was set aside on 14th July, 2000. The matter was before the A.O., for fresh determination on which an order came to be passed on 22nd March, 2002 and co....