LexM/S STEEL AUTHORITY OF INDIA LTD. versus COMMISSIONER OF CENTRAL EXCISE, RAIPUR
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A B C D E F G H 400 SUPREME COURT REPORTS [2019] 7 S.C.R. M/S STEEL AUTHORITY OF INDIA LTD. v. COMMISSIONER OF CENTRAL EXCISE, RAIPUR (Civil Appeal No. 2150 of 2012) MAY 8, 2019 [RANJAN GOGOI, CJI, UDAY UMESH LALIT AND K. M. JOSEPH, JJ.] Central Excise Act, 1944: s.11AB – Demand of interest under s.11AB – Whether interest is payable under s.11AB of the Act on the differential excise duty with retrospective effect that became payable on the basis of escalation clause – Held: If there is a non-levy, non- payment, short-levy or short-payment, the same becomes recoverable under s.11A – In any of the four contingencies namely, non-levy, non-payment, short-levy or short-payment referred to in s.11A, s.11AB is attracted – Thus, in any of the four contingencies, for any duty that is determined or paid as provided under s.11A, necessarily the assessee becomes liable to pay interest under s.11AB – The interest clock ticks from the date as provided in r.8 r/w s.11AB – The expression “the month in which the duty ought to have been paid” under s.11AB of the Act, when it is read alongwith r.8, which declares that the duty on the goods removed from the factory or warehouse during a month is to be paid on the 6th day of the following month would mean that the Legislature has understood the expression “the month in which the duty ought to have been paid” under the Act in the same sense as it is declared in r.8 – Central Excise Rules, 2002 – r.8. Central Excise Act, 1944: s.11AB – When price is revised upward with retrospective effect and the excise duty on the same is paid immediately on a future date, whether interest is payable under s.11AB from the first day of the month succeeding the month in which the duty ought to have been paid under the Act – Held: Under the Rules, goods become exigible to duty on removal – Assessment is to be done by assessee itself by way of self-assessment – In a case where duty is payable on the basis of the value, the assessee is to apply the rate of duty to the value and pay the duty on or before the sixth day of the month succeeding the month in which removal of the goods takes place – When the provisional assessment is [2019] 7 S.C.R. 400 400 A B C D E F G H 401 finalized, the assessee becomes liable, however, to pay interest from the first date of the month succeeding the month for which the amount is determined – Central Excise Rules, 2002 – r.8. Dismissing the appeals, the Court HELD : 1. The scheme of the Central Excise Act and the Rules are a separate code. Section 11A is a provision for recovery. If there is a non-levy, non-payment, short-levy or short-payment, the same becomes recoverable under Section 11A. If there is any of the four contingencies referred to in Section 11A, then Section 11AB is attracted. The working of the parent Act is intricately intertwined with the rules. Therefore, if the value which is declared by way of self-assessment, by way of rule 6 and on which the duty is paid is not the full value then under the scheme of Section 11A read with Section 11AB and the Rules, the assessee incurs liability for interest when in a case where there is full value found and it dates back to the date of removal. In this case, admittedly, at the time goods were removed the price was not fixed. The assessee was fully conscious of the fact that it was subject to variation and had knowledge that the value it was declaring was amenable to upward revision. The circumstances were indeed clearly appropriate for the assessee to invoke the provisions of Rule 7 and seek an order for provisional assessment. [Paras 35, 36] [440-A-D] Rainbow Industries (P) Ltd. v. CCE (1994) 6 SCC 563 : [1994] 4 Suppl. SCR 135 ; Balarpur Industries Ltd. v. Assistant Collector of Customs and Central Excise & Ors. (1995) Suppl. (3) SCC 429 ; Collector of Central Excise, Baroda v. Cotspun Ltd. (1999) 7 SCC 633 : [1999] 3 Suppl. SCR 184 ; M/s. Eastland Combines, Coimbatore v. Collector of Central Excise, Coimbatore AIR 2003 SC 843 : [2003] 1 SCR 98 ; ITW Signod India Limited v. Collector of Central Excise (2004) 3 SCC 48 : [2003] 5 Suppl. SCR 751 – referred to. 2. Undoubtedly, the amended provisions of Section 11A empowered recovery of duty even in a case where the classification list has been approved earlier and it would operate M/S STEEL AUTHORITY OF INDIA LTD. v. COMMISSIONER OF CENTRAL EXCISE, RAIPUR A B C D E F G H 402 SUPREME COURT REPORTS [2019] 7 S.C.R. from the date of removal and not from the date on
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