Calculation of interest for delayed payment

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This query is : Resolved

satyanarayana murthy (Querist)

28 March 2014 Dear All,
One of my client has paid interest for his delayed payment of duty payable which fell in short for payment. The no. of days calculated by them from the due date to till the payment date @ 18% P A. Actually the total liability of duty is Rs. 834659 they used CENVAT Rs. 636549 balance of Rs. 198110 is cash payment and delayed payment also. Now they calculated interest on Rs. 198110 under Section of 11AA of central excise act. But the department is pressurizing to calculate the interest on the total amount of Rs. 834659. Now I want to confirm is it correct or not? What was the procedure laid down in the law?
Please guide me.
Thanks in advance.
Regards,
Murthy

Arun Kumar Singh

Arun Kumar Singh (Expert)

29 March 2014 If closing balance of the cenvat credit has been carry forward from actual duty payment then interest will be payable on of rs. 198110/- otherwise you need to pay interest on whole duty payable i.e.834659/-.

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