WP(C) 8798/2004 BEFORE HON’BLE MR. JUSTICE HRISHIKESH ROY 1. Heard Mr. GN Sahewalla, learned senior counsel appearing for the petitio ner. Also heard Mr. B Sarma, learned senior standing counsel for the Central Exc ise Department representing the respondents. 2. The petitioner’s Factory is registered with the Central Excise Departmen t as a manufacture of tea, bearing Regn. No.AABCRO236 PXMOO1 and they challenge the adjudication order dated 4th October, 2004 (Annexure-IX) of the Asstt. Commi ssioner, Central Excise, whereby the demand of interest on delayed payment of ad ditional duty of excise, has been conformed in the adjudicatory process. 3.1. Following the Finance Act, 2003 (hereinafter referred to as ’the 2003 Ac t’) i.e. No.32/2003, additional duty of excise became leviable at the rate speci fied in the schedule and by the demand notice dated 27th November, 2003 issued b y the Superintendent, Central Excise, Dibrugarh-1 Range (Annexure-IV), Rs.2,17,6 90/- (Rupees two lakhs seventeen thousands six hundred ninety) was demanded from the petitioner as central excise duty for clearance made during 1st March, 2003 to 30th June,2003 (wrongly stated as 31st October, 2003). 3.2. The demanded excise duty was deposited by the petitioner on 29th March, 2003. But alleging that there was delay in payment, a proceeding was initiated t hrough the show cause notice dated 31st March, 2003 (Annexure-V) to recover inte rest at the rate of Rs.1000/- per day and maximum interest equivalent to the pai d duty of Rs.2,17,690/- (Rupees two lakhs seventeen thousands six hundred ninety ), was proposed to be recovered from the petitioner. Eventually by the impugned adjudication order, demand of interest at the rate of Rs.1000/- per day upto the maximum limit, was confirmed by the Assistant Commissioner, Central Excise. 4. Arguing for the petitioner it is submitted by Mr. Sahewalla that the pet itioner does not dispute its liability to pay additional excise duty on manufact ure of tea by virtue of Section 157 of the 2003 Act. However the learned counsel contends that the interest on delayed payment charged at the rate of Rs.1000/- per day is impermissible, in view of the notification dated 12th May, 2000 issue d under Section 11AA of the Central Excise Act, 1944. 5. Mr. B Sarma, the learned standing counsel by referring to the decision o f Division Bench of this Court rendered on 30th June, 2005 in a batch of Writ Ap peal including the Writ Appeal No.55/2005 (Union of India vs. Assam Brook Ltd.) submits that the liability of the petitioner to pay additional excise duty in pu rsuant to the 2003 Act, is already settled by this Court. He further submits tha t as there was delay in depositing the excise duty, the petitioner has been righ tly fastened with interest liability for delayed payment under Section 11AA of t he Central Excise Act, 1944. 6.1. From the materials on record, it is clear that the duty payable on manuf acture of tea during 1st March, 2003 to 30th June, 2003 was deposited by the pet itioner on 29th March, 2004. The petitioner was asked to deposit the excise duty within 15 days of the demand notice dated 27th November, 2003. Section 11AA pro vides that if the demanded duty is not paid within 3 months from the date of de termination , interest at the appropriate rate is required to be paid for such delayed payment. 6.2. According to the Notification No.39/2000-CE(NT) dated 12th May, 2000 iss ued under Section 11AA of the Central Excise Act, 1944, the rate of interest is fixed at 24% per annum for the purpose of Section 11AA of the Act. The contents of the notification dated 12th May, 2000 is extracted hereinbelow for ready refe rence: In exercise of the powers conferred by section 11AA of the Central Excise Act, 1944 (1 of 1944) and in supersession of the notification of the Government of In dia in the Ministry of Finance (Department of Revenue), No.7/2000-Central Excise (N.T.) dated the 1st March, 2000 [G.S.R. 199(E), dated the 1st March, 2000], ex cept as respects things done or omitted to be done before such supersession, the Central Government hereby fixes the rate of interest at twenty-four per cent pe r annum for the purposes of the said section . 7. The rate of chargeable interest is specified by the notification dated 1 2th May, 2000 for delayed payment and interest beyond 24% cannot be recovered un der Section 11A. Furthermore, the interest is chargeable under Section 11AA only if the assessee fails to pay duty, within 3 months from the date of determinat ion . Therefore, while deciding on the amount of interest payable for delay in d uty payment, the adjudicating authority is required to firstly take into account as to when, the payable duty was determined and secondly the rigours of the C.E . Notification No.39/2000 as interest cannot exceed 24% per annum, under the sai d notification dated 12th May, 2000. 8. But from the show cause notice dated 31st March, 2004 of the Superintend ent, Central Excise, Dibrugarh-1 Range as well as the adjudication order dated 4 th October, 2004 of the Assistant Commissioner, Central Excise, Dibrugarh it is apparent that interest at a much higher rate i.e. at Rs.1000/- per day was deman ded and the maximum chargeable interest equivalent to the payable excise duty wa s confirmed against the assessee. The said demand in my view is inconsistent wit h the provisions of Section 11AA and also the notification dated 12th May, 2000. 9. Having concluded thus, while upholding the petitioner’s liability to pay interest for delayed payment of excise duty for the period 1st March, 2003 to 3 0th June, 2003, the amount of interest payable is ordered to be re-determined by the competent Authority so that the same conform to the maximum rate of interes t, specified by the Departmental Notification No.39/2000 dated 12th May, 2000 an d the provisions of Section 11AA of the Central Excise Act, 1944. It is ordered accordingly. 10. The writ petition stands disposed of with the above direction without an y order of cost.