Interest and penalty cannot be levied on late payment of duty that is exempted under the Central Excise Act, as no liability arises for such payments.

JUDGMENT :

Heard Dr. A. Saraf, learned Senior Counsel assisted by Mr. P. Baruah, learned counsel for the petitioner. Also heard Mr. S.C. Keyal, learned Standing Counsel for the GST.

2. The petitioner in the Writ Petition No. being W.P (C) No. 4068/2021, has challenged the order dated 22.09.2017 passed by the Assistant Commissioner of GST & CX Division-I (Annexure -VII) levying interest and penalty on the late payment of duty, which was exempted in view of the Notification No. 20/2007-CE dated 25.04.2007 (Annexure II), and the order dated 29.09.2020 passed by the Assistant Commissioner of GST & Central Excise rejecting the representation dated 12.09.2017 submitted by the Petitioner and upholding the levy of interest and penalty on the delay in payment of duty.

3. In the Writ Petition No. being W.P (C) No. 3965/2021, the petitioner has challenged the order dated 21.09.2017 passed by the Assistant Commissioner of GST & CX, Division-I (Annexure-VII) levying interest and penalty on the late payment of duty, which was exempted in view of the Notification No. 20/2007-CE dated 25.04.2007 (Annexure-II), and the order dated 29.09.2020 passed by the Assistant Commissioner of GST & Central Excise rejecting the representation dated 12.09.2017 submitted by the Petitioner and upholding the levy of interest and penalty on the delay in payment of duty.

4. In the Writ Petition No. being W.P (C) No. 4025/2021, the petitioner has challenged the Order dated 17.03.2017(Annexure-VII) passed by the Deputy Commissioner, Central Excise and Service Tax Division-I, levying interest and penalty on the late payment of duty, which was exempted in view of the Notification No. 20/2007-CE dated 25.04.2007 (Annexure-II), and the Order dated 29.09.2020 passed by the Assistant Commissioner of GST & Central Excise rejecting the representation dated 12.09.2017 submitted by the petitioner and upholding the levy of interest and penalty on the delay in payment of duty.

5. Pertinent that the issue involved being identical in the three writ petitions, the said writ petitions are being taken up for hearing together and are being disposed of by this common Judgment and Order.

6. In W.P (C) No.3965/2021, for the month of March-2016, the interest and penalty is amounting to Rs. 3,52,266/-.

7. In W.P (C) No. 4025/2021, for the month of November-2014, January-2015, February-2015 and March-2015, the interest and penalty is amounting to Rs. 6,75,593/-.

8. In W.P (C) No. 4068/2021, for the month of April-2016, May-16, June-2016 and July-2016, the interest and penalty is amounting to Rs. 3,71,282/-.

9. The Government of India on 01.04.2007 announced a new Policy namely the North-East Industrial and Investment Promotion Policy (NEIIPP), 2007. Vide the said Policy, the Government of India had approved a package of fiscal concessions and other concession for the North Eastern Region. In the said Policy i.e. NEIIPP of 2007, in the issue of Excise duty exemption under clause (v), it was clearly noted that “hundred percent excise duty exemption will be continued, on finished products made in the North Eastern Region, as was available in North East Industrial Policy, 1997”.

10. To give effect to the Industrial Policy Resolution, 2007, a Notification was issued in exercise of power under Section 5A of the Central Excise Act, 1944being Notification No. 20/2007 dated 25.04.2007 exempting the goods specified in the first schedule of the Central Excise Tariff Act, 1985 from so much of the duty of excise leviable thereon under the said Act as is equivalent to the amount of duty paid by the manufacturer of goods other than the amount of duty paid by utilization of CENVAT credit under the CENVAT Credit Rules, 2004. As per the said notification No. 20/2007 dated 25/4/2007, the exemption contained in the said Notification was to apply to a new Industrial Unit which commenced commercial production on or after 1stday of April, 2007 but not later that 31stday of March, 2017 or Industrial units existing before