Central Excise Act 1944

⁸[11AA. Interest on delayed payment of duty.-

(1) Notwithstanding anything contained in any judgment, decree, order or direction of the Appellate Tribunal or any court or in any other provision of this Act or the rules made thereunder, the person, who is liable to pay duty, shall, in addition to the duty, be liable to pay interest at the rate specified in sub-section (2), whether such payment is made voluntarily or after determination of the amount of duty under section 11A.

(2) Interest, at such rate not below ten per cent. and not exceeding thirty-six per cent. per annum, as the Central Government may, by notification in the Official Gazette, fix, shall be paid in terms of section 11A after the due date by the person liable to pay duty and such interest shall be calculated from the date on which such duty becomes due up to the date of actual payment of the amount due.

(3) Notwithstanding anything contained in sub-section (1), no interest shall be payable where,—

(a) the duty becomes payable consequent to the issue of an order, instruction or direction by the Board under section 37B; and

(b) such amount of duty is voluntarily paid in full, within forty-five days from the date of issue of such order, instruction or direction, without reserving any right to appeal against the said payment at any subsequent stage of such payment.”]

^old [¹[11AA. Interest on delayed payment of duty.-

²[(1)] ³[Subject to the provisions contained in section 11AB, where a person], chargeable with duty determined under sub-section (2) of section 11A, fails to pay such duty within three months from the date of such determination, he shall pay, in addition to the duty, interest ⁴[at such rate not below ⁵[ten per cent and not exceeding thirty six per cent per annum as is for the time being fixed by the Central Government, by notification in the official gazette], on such duty from the date immediately after the expiry of the said period of three months till the date of payment of such duty:

Provided that where a person chargeable with duty determined under sub-section (2) of section 11A before the date on which the Finance Bill, 1995 receives the assent of the President, fails to pay such duty within three months from such date, then, such person shall be liable to pay interest under this section from the date immediately after three months from such date, till the date of payment of such duty.

Explanation 1.—

Where the duty determined to be payable is reduced by the Commissioner (Appeals), Appellate Tribunal or, as the case may be, the court, the date of such determination shall be the date on which an amount of duty is first determined to be payable.

Explanation 2.—

Where the duty determined to be payable is increased or further increased by the Commissioner (Appeals), Appellate Tribunal or, as the case may be, the court, the date of such determination shall be,—

(a) for the amount of duty first determined to be 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.

⁶[(2) The provisions of sub-section (1) shall not apply to cases where the duty becomes payable on and after the date ⁷on which the Finance Bill, 2001 receives the assent of the President.]]

1. Inserted (w.e.f. 26-5-1995) by s. 73 of the Finance Act, 1995 (22 of 1995).

2. Section 11AA re-numbered as sub-section (1), by s. 124 of the Finance Act, 2001 (14 of 2001).

3. Substituted (w.e.f. 28-9-1996) by s. 75 of the Finance (No.2) Act, 1996 (33 of 1996).

4. Substituted (w.e.f. 12-5-2000) by s. 98 of the Finance Act, 2000 (10 of 2000).

5. Substituted (w.e.f. 11-5-2002) for the words “eighteen per cent” by s. 135 of the Finance Act, 2002 (20 of 2002).

6. Inserted (w.e.f. 11-5-2001) by s. 124 of the Finance Act, 2001 (14 of 2001).

7. Finance Bill 2001 was assented on 11-5-2001.

Relevant Notifications & Circulars

8. Substituted vide Chapter IV of the Finance Act 2011 w.e.f. from enactment of Finance Bill 2011

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