2017 (10) TMI 337

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....nder Section 11AA of the Central Excise Act. The learned Commissioner (A) has disposed of two appeals and therefore, before the Tribunal two appeals have been filed. In fact M/s. Karnataka Minerals and Manufacturing Company Limited (KMMCL) was taken over by M/s. Madras Cements Ltd. along with the liabilities of M/s. Karnataka Minerals and Manufacturing Company Limited in the month of August 2002. For the sake of convenience, the facts of appeal No. E/208/2005 are taken. 2. Briefly the facts of the case are that duty recovery proceedings were initiated against KMMCL by the Commissioner of Central Excise, Belgaum, who vide his Order-in-Original No.12/91 dated 25.10.1991 confirmed payment of duty to the tune of Rs. 88,51,309/- which was paid ....

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....rned Commissioner (A) has wrongly demanded the interest because when the differential duty payable was determined, Section 11AA was not in existence and hence no interest is payable on the differential duty paid by KMMCL on 30.10.1999. He further submitted that Section 11AA has been brought to the statute on 26.5.1995 and the same cannot be applied retrospectively. He further submitted that even the CBEC has given the clarification vide their Circular No.655/46/2002-CX dated 26.6.2002 which will be applicable in the present case also. In support of his submission, he relied upon the following decisions: * Komal Straw Board vs. CCE, Ludhiyana: 2005 (186) ELT 584 (Tri.-Del.) * Sweta Exports: 2003 (160) ELT 956 * CCE vs. General Pharma: 20....

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....ssions of both the parties and perusal of the material on record, we find that Section 11AA was brought to the statute on 26.5.1995 and as per the proviso to the said Section as interpreted by the High Court of Gujarat that it has retrospective application. Here it is pertinent to reproduce the findings of the Hon'ble High Court of Gujarat which are reproduced herein below: Retrospective application + The statute which creates new rights or liabilities, is ordinarily to be applied prospectively unless either expressly or by necessary implication, it is given retrospective effect. The fact that section 11AB was made expressly prospective is clear from the language used in subsection (2) of section 11AB. + In contrast, there are inbuilt in....

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....to pay interest would commence from such date. + By necessary implication, section 11AA was meant to apply to all cases where the duty remained unpaid after introduction of section 11AA to the statute. + In cases where whether the liability to pay the duty arose before or after the introduction of section 11AA but determination took place after the said date, the liability to pay interest would arise under the main body of the section. + In cases where the liability as well as determination both took place before the introduction of section 11AA, such cases would be covered under the proviso and liability to pay interest would commence after the end of three months from the date of introduction of section 11AA to the Act. Significantly, ....