Judgment : Writ petition by a manufacturer of Block Boards and timber boards in respect of which the petitioner-a private company was being assessed to duty payable under the Central Excises and Salt Act, 1944 as it stood at the relevant point of time and as amended (referred to as the ‘Act’ hereinafter) within the jurisdiction of the third respondent viz., the Assistant Commissioner of Central Excise at Mangalore. 2. The petitioner in respect of the period from July 1991 to November 1991 had cleared the manufactured goods by paying duty provisionally and cleared the goods on self-assessment by filing RT-12 returns as envisaged under Rule 173-G of the Central Excise Rules, 1944 and referred to as the Rules, indicating the duty liability as nil in the light of a claim of the petitioner that the goods are not dutiable having been provisionally accepted. 3. The provisional clearance was on the premise that the goods manufactured by the petitioner were to be classified under Entry 4408.90 as claimed by the petitioner-assessee and on the premise that what was being manufactured was timber boards and this classification list was yet to be finalised. 4. It appears, subsequently the classification list was finalised by the Competent Authorities and the classification as indicated by the assessee was not accepted, but, the classification by the authority was as block boards dutiable under Entry 4408.90, Chapter 44 of the Schedule to the Central Excise Tariff Act, 1985. 5. The assessee was not very happy with this classification and it appears, had carried the matter by way of appeal and second appeal to the Tribunal and being not successful carried the matter to the High Court of Delhi by way of writ petition. The writ petition was allowed and the matter was remanded to the Tribunal. The Tribunal had a second look into this matter but was nevertheless convinced, that the revenue was right in classifying the goods manufactured by the petitioner under Entry 4408.90 and the differential demand raised by the revenue was confirmed. 6. During the pendency of the matter before the High Court and before the Appellate Authority, it appears the petitioner was permitted to pay 50% of the differential duty and the other 50% remained due to the revenue. 7. 6. During the pendency of the matter before the High Court and before the Appellate Authority, it appears the petitioner was permitted to pay 50% of the differential duty and the other 50% remained due to the revenue. 7. The assessee being still not satisfied by the view taken by the Tribunal, even in the second round, it appears, had carried the matter to the Supreme Court by way of appeal under Section 35-L. 8. In this state of affairs, the Excise Department thought that the differential duty which has to be realised should be realised by the issue of notice under Section 11-A of the Act, and had called upon the petitioner-assessee to pay the balance of duty which was remaining outstanding to be paid and to show cause as to why it should not be recovered. 9. The assessee it appears had objected to the demand under Section 11-A. Section 11-A notice having been issued on 31-3-1992 and 17-6-1992 and by this time, the dispute regarding classification having not attained finality, the assessee contended that the department cannot seek to recover the amount either by way of duty due or otherwise as the question of classification being not finalised; the related question of rate of duty having not finalised and the duty liability also being not known, invocation of Section 11-A does not arise at this stage. 10. However, it appears the Assessing Authority who had invoked the provisions of Section 11-A was not convinced with this line of reasoning and confirmed the proposition calling upon the assessee to pay the differential duty which had been in fact determined on the RT 12 returns which had been filed earlier but, were rejected and the department had ascertained the actual duty liability under Rule 173-I of the Central Excise Rules and the Section 11-A order was only a reiteration of the earlier determination. 11. The assessee yet again was not satisfied with this order under Section 11-A and had taken up the matter to the Appellate Authority and to the Tribunal but without success. Thereafter the matter was brought to this Court by filing W.P.Nos.38233 to 38383 of 1998. However, the matter though had been taken up for examination by this Court by issue of rule, the writ petition itself was dismissed on 1-3-1999 and the proceedings insofar as Section 11-A demand was concerned ended with this. 12. Thereafter the matter was brought to this Court by filing W.P.Nos.38233 to 38383 of 1998. However, the matter though had been taken up for examination by this Court by issue of rule, the writ petition itself was dismissed on 1-3-1999 and the proceedings insofar as Section 11-A demand was concerned ended with this. 12. In the meanwhile, it appears the assessee had also made an attempt to have the question resolved by resort to settlement provisions which were in vogue in the form of Kara Vivad Samadhan Scheme That also being not productive for the assessee again the matter was brought to this Court by way of Writ Petition Nos.28128 to 28135 and 28195 to 28200 of 1999. Again there was no success for the assessee as not only the writ petition was dismissed, but also the writ appeal. Further attempt before the Supreme Court in Civil Appeal Nos.3758 to 3767 of 2000 was also futile as the Hon'ble Supreme Court dismissed the appeals by judgment dated 17-3-2005. With this, all doors were closed for the assessee and it became inevitable for the assessee to pay the balance of duty as had been demanded in terms of Section 11-A proceedings and order. It appears the outstanding amount payable by the assessee was a sum of Rs. 7,64,055/- subject-matter in W.P.No.26605 of 2005 and a sum of Rs. 9,62,971/- subject-matter in W.P.No.26603 of 2005. 13. If the matter should not have been disturbed and if the assessee should have cleared the outstanding dues by then or before an intervening legislation in form of Section 11-AA, there would not have been any further controversy between the revenue and the assessee. But, unfortunately for the assessee, the Legislature introduced the provisions of Section 11-AA of the Central Excise Act by way of Finance Act, 1995 and with effect from 26-5-1995. Section 11-AA reads as under: "Section 11-AA. But, unfortunately for the assessee, the Legislature introduced the provisions of Section 11-AA of the Central Excise Act by way of Finance Act, 1995 and with effect from 26-5-1995. Section 11-AA reads as under: "Section 11-AA. Interest on delayed payment of duty.—(1) Subject to the provisions contained in Section 11-AB, where a person chargeable with duty determined under sub-section (2) of Section 11-A, fails to pay such duty within three months from the date of such determination, he shall pay, in addition to the duty, interest at such rate not below 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 11-A 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 to further increased. (2) 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". 14. (2) 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". 14. The statutory provision provided for levy of interest on delayed payment of duty and in terms of this provision, the assessee who had suffered an order under the provisions of Section 11-A of the Act who had not paid the duty determined and demanded within the permitted time of three months, would become liable to pay the outstanding duty with interest at the notified rates which was being changed from time to time by issue of notifications by the Central Government and ranging from 10% to 36%. 15. The revenue calculated the interest leviable on the outstanding duty that was due by the assessee after the provision of Section 11-AA had become operative and called upon the assessee to pay the interest amount along with the outstanding duty. 16. It so happened that the interest part itself was a huge amount being a sum of Rs.27,52,744/- for the period ending upto 30-9-2004 in W.P.No.26605 of 2005 and Rs.25,19,735/- in W.P.No.26603 of 2005. The assessee was quite naturally aggrieved with the second round of demand for payment of interest and had appealed to the Commissioner of Central Excise in terms of representation at Annexure-R in Writ Petition No.26605 of 2005 and another representation of even date Annexure-V to Writ Petition No.26603 of 2005. 17. Such representations having been rejected by the Commissioner, the petitioner has approached this Court by filing the above writ petitions. 18. The writ petitions had been admitted for examination. The respondents have entered appearance through the Standing Counsel. I have heard Sri Rajesh Chander Kumar, learned Counsel appearing for the petitioner and Sri Shashikanth, learned Central Government Standing Counsel representing the respondent/revenue. 19. 18. The writ petitions had been admitted for examination. The respondents have entered appearance through the Standing Counsel. I have heard Sri Rajesh Chander Kumar, learned Counsel appearing for the petitioner and Sri Shashikanth, learned Central Government Standing Counsel representing the respondent/revenue. 19. Submission of Sri Rajesh Chander Kumar, learned) Counsel for the petitioner is that levy of interest under Section 11-AA is a subsequent liability introduced to the Act by way of amendment to the Parent Act by the Finance Act, 1995; that the duty liability of the petitioner for the said periods had already been finalised in, the year 1992 when the demand was finalised in terms of Rule 173-I of the Central Excise Rules, and therefore there was no occasion for the revenue to have invoked the provisions of Section 11-A as it was never the case of the revenue that the assessee had either suppressed any material fact or had not disclosed any relevant material for the purpose of determination of the actual duty liability in respect of the goods manufactured by the petitioner and in this state of affairs, there is absolutely no justification for the levy of interest under Section 11-AA as levy of interest under this provision can only be in a situation where there was a duty demand assessed, raised and demanded under Section 11-A and was still outstanding and having not been paid within the permitted time of three months. It is also the contention of the learned Counsel for the petitioner that the statutory provision of Section 11-AA itself having been introduced in the year 1995 and the duty liability having been finalised, long prior to the introduction of this provision and, there being no occasion for enabling the provision to levy interest if it a period prior to the introduction of Section 11-AA even in respect of outstanding duty amount, the provision could not have been pressed for levy of interest against the petitioner as the duty liability was not finalised at any point of time either prior to the coming into force of Act of 1995 or subsequently by a proper determination under Section 11-A of the Act. 20. 20. This submission is on the premise that though the duty amount had been technically mentioned in an order passed under Section 11-A of the Act, but it was only reiteration of the amount that had already been determined pursuant to the orders passed under Rule 173-I of the Central Excise Rules as it prevailed at the relevant time and the substance of the order being not one relatable to invocation of the power under Section 11-A of the Act and that order itself being bad in law, when there was absolutely no occasion to invoke the provisions of Section 11-A and the same was not sustainable in law and if such is the position, the further invocation of the provisions of Section 11-AA of the Act to levy interest on an amount which had not been actually determined under the provisions of Section 11-A is only rubbing salt to the injury and at any rate is not permissible in law, that the levy of interest is not authorised in law and therefore the order levying interest is violative of Article 265 of the Constitution of India. 21. On such grounds, the orders determining the interest payable by the petitioner on the basis of which demands have been raised are sought to be quashed by way of issue a writ of certiorari. 22. In support of such submission, learned Counsel for the petitioner would place reliance on the decision of the Supreme Court in Serai Kella Glass Works Private Limited v Collector of Central Excise, Patna AIR 1997 SC 1948 : (1997)4 SCC 641 : 1997 (91) ELT 497 (SC), particularly by placing reliance on paras 16, 17 and 18 of this judgment. In support of such submission, learned Counsel for the petitioner would place reliance on the decision of the Supreme Court in Serai Kella Glass Works Private Limited v Collector of Central Excise, Patna AIR 1997 SC 1948 : (1997)4 SCC 641 : 1997 (91) ELT 497 (SC), particularly by placing reliance on paras 16, 17 and 18 of this judgment. Submission based on this decision is that in a case where the duty liability has already been determined under, the provisions of law whether on a regular assessment or on finalising a provisional assessment and the consequential duty had already been demanded, for the realisation of that amount, there is no occasion to invoke the provisions of Section 11-A of the Act; that it is not a case of a duty liability to be assessed which had escaped assessment, but it is only a question of a duty which had already been assessed having been not realised and therefore, if at all a situation of this nature is to be pursued by invoking the recovery provisions under Section 11 of the Act and invoking the provisions of Section 11-A of the Act is totally a misadventure and if the revenue had indulged in a misadventure by wrongly invoking Section 11-A, that cannot further aid the revenue to compound its mistake by calling upon the petitioner to pay further interest on the outstanding amount not determined under the provisions of Section 11-A of the Act, but which had already been quantified without resort to Section 11-A. 23. Reliance is also placed on the Division Bench judgment of the Bombay High Court in the case of Swan Mills Limited v Union of India 1989(44) ELT 601 (Bom.). 24. Reliance is also placed on the Division Bench judgment of the Bombay High Court in the case of Swan Mills Limited v Union of India 1989(44) ELT 601 (Bom.). 24. Sri Shashikanth, the learned Central Government Standing Counsel, appearing for the revenue on the other hand would submit with reference to the statement of objections, that writ petition has no merit and the demand raised for payment of interest by the revenue is well-sustained by the statutory provisions; that the contentions urged on behalf of the assessee are not tenable as it proceeds on a non-existent premise; that the dispute cannot even be raised in the present situation that there is no actual order under the provisions of Section 11-A; that in fact there was an order passed under Section 11-A; that notwithstanding the order, the assessee had not paid the demanded amount as determined under Section 11-A and therefore the provisions of Section 11AA were inevitably attracted and if the interest amount is quantified, no exception can be taken for doing so and the writ petitions are to be dismissed. 25. Elaborating the submissions, Sri Shashikanth would draw attention to the actual orders passed under Section 11-A of the Act and would submit that not only the assessee had suffered these orders, but such orders has attained finality as the assessee though made an attempt to get over these orders by filing appeal to the First Appellate Court and in turn , to this Court, the orders were confirmed as noticed earlier and therefore there is no merit in the contention on behalf of the assessee that the provisions of Section 11-AA of the Act are not attracted to a situation of this nature. 26. In support of the submission the learned Standing Counsel would place reliance on the very decision of Serai Kella Glass Works Private Limited’s case and would point out that the question that arises in this case in fact never arose in that case and the question was entirely different. 26. In support of the submission the learned Standing Counsel would place reliance on the very decision of Serai Kella Glass Works Private Limited’s case and would point out that the question that arises in this case in fact never arose in that case and the question was entirely different. The provisions of Section 11-A was not attracted to a situation where the provisional assessment order had been quashed or set aside and the matter had been remanded to the Assessing Authority for redetermination and the contention of the assessee that even for such redetermination on remand, the revenue should have invoked the provisions of Section 11-A having been rejected, that judgment cannot be an authority for the proposition as contended by the learned Counsel for the petitioner. 27. The learned Standing Counsel would also submit that the question of violation of the provisions of Article 265 of the Constitution of India is also not involved in the present case for the simple reason that the demand for payment of interest under Section 11-AA is well-sustained on the strength of the statutory provisions and therefore, a demand under Section 11-AA automatically arises the moment any amount that had been determined under Section 11-A as duty payable and which was outstanding after expiry of the stipulated period and in the present case, this requirement having been made good and as is obvious from the record, there is no question of Article 265 being attracted and any levy being characterised as without the authority of law. 28. Article 265 of the Constitution of India reads as hereunder: "265. Taxes not to be imposed save by authority of law.—No tax shall be levied or collected except by authority of law" 29. Submission on behalf of the revenue is that the demand for payment of interest is well-sustained on the relevant statutory provision and there is no violation of Article 265 of the Constitution of India. 30. I have bestowed my attention to the submissions made at the bar and perused the petition pleadings, the impugned orders and the relevant statutory provisions. The applicability of the judgments relied upon at the bar is also examined. 31. So far as the facts are concerned, they are not at all in dispute and it is as narrated above. 30. I have bestowed my attention to the submissions made at the bar and perused the petition pleadings, the impugned orders and the relevant statutory provisions. The applicability of the judgments relied upon at the bar is also examined. 31. So far as the facts are concerned, they are not at all in dispute and it is as narrated above. It is a pure question of law and that question is as to whether the petitioner is liable for payment of interest under Section 11-AA of the Central Excise Act for the period subsequent to three months after the coming into force of the provisions of Section 11-AA in respect of the outstanding duty liability which had not been paid by the assessee even expiry of this period of three months and which had become due on orders passed under Section 11-A of the Act. 32. The related question is if the duty liability had been determined even long prior to introduction of the provisions of Section 11-AA, would such an outstanding amount also attract the provisions of Section 11-AA and after the period referred to above. 33. While the submission on behalf of the assessee is that the order passed under Section 11-A itself being bad in law, invoking of the provisions of Section 11-AA is also equally bead as it is in furtherance of proceedings taken under Section 11-A and unless the action is backed by a valid order passed under Section 11-A of the Act, and it cannot stand on its own and should be quashed. On the other hand, the stand of the revenue is that the assessee having failed to get over the order passed under Section 11-A whether it is right or wrong that order sticks to the assessee and therefore, there is nothing wrong in invoking the provisions of Section 11-AA. Factually, the assessee had suffered order under Section 11-A. It could have been a debatable issue if the revenue was justified in invoking the provisions of Section 11-A when they were not bringing to duty any escaped assessment and the further question as submitted by Sri Shashikanth, learned Counsel is that Section 11-A also covers the outstanding duty amount which had not been realised and it is not always necessary to invoke Section 11-A only in a situation where some duty had escaped assessment. But in the present situation and in the prevailing state of affairs, petitioner is not entitled to agitate the question as it fact it has already been answered against the petitioner/assessee in the earlier proceedings. The levy of interest under Section 11-AA happens to be a consequential proceeding i.e., consequential to the order passed under Section 11-A. Therefore, if the Section 11-A order whether right or otherwise had between the parties attained finality and had been affirmed by this Court, it is no more open to the petitioner to contend that the order under Section 11-A was bad in law and therefore the further invocation of the provisions of Section 11-AA is also equally bad in law. The argument being not open to the petitioner, it is not necessary to consider this question in these writ petitions, 34. Neither the judgment of the Supreme Court in the case of Serai Kella Glass Works Private Limited nor the judgment of the Bombay High Court in the case of Swan Mills Limited, referred to and relied upon by Sri Rajesh Chander Kumar, learned Counsel for the petitioner can advance the case of the petitioner for the reason that in fact there exists orders passed under Section 11-A of the Act, which have attained finality. Technically speaking, there being in existence orders passed invoking the provisions of Section 11-A of the Act and such orders having attained finality, the provisions of Section 11-AA is definitely attracted and it cannot be said that invoking provisions of Section 11-AA is bad in law. If such is the legal position, there is no occasion to find fault with the orders for payment of interest for the period subsequent to the expiry of three months from the date of the provisions of Section 11-AA coming into force. It is not in dispute that the levy of interest is confined to this period and if such is the factual position also, the demands for payment of interest cannot be found fault with. No occasion I or justification for this Court to interfere in the exercise of jurisdiction under Articles 226 and 227 of the Constitution of India. Accordingly, these petitions are dismissed.