LUCID COLLOIDS LIMITED Vs. UNION OF INDIA

JUDGEMENT

(1.) TWO principal prayers have been made in the writ petition relating to challenge the vires of Rule 8(3) of the Central Excise Rules, 2002 as under:

(2.) THE provision in the parent Act which authorises charge of interest on delayed payment of duty reads as under:

(3.) THE contention of the learned Counsel for the petitioner is that the parent Act does not authorize the Central Government to lay the procedure and method for levy of quantification of interest but merely authorises to notify the rate of interest per annum which is to be levied on delayed payment of Duty, or wrongful receipt of refund as the case may be, and therefore, to the extent it provides levy of collecting interest chargeable on delayed payment of duty by fixing Rs. 1,000/ - per day to the minimum penalty if it does not exceed the amount chargeable as interest at the rate of 2% per month cannot be sustained. The rule in effect amounts to providing rate of interest chargeable on delayed payment of duty at 2% subject to minimum interest @ Rs. 1,000/ - per day.