Excess itc claimed in2017-18

No interest is required to be paid

But officer is demanding interest on it

As per Section 40(2) of CGST Act, interest is NOT payable on ITC claimed in excess (as per Section 50(3) of the CGST Act) if the same is Not utilised for setoff of output tax liability.

A good article is available on Ta_gur_ if you look for "Interest on irregular availment of ITC under GST" on the internet (..read from 5th para onwards).

Yes interest is applicable @ 24% even though the same being not utilised , but as per Section 41 of CGST Act the eligible ITC only can be credited to ECL. & moreover , Section 50(3) of CGST Act stating The interest applicable the person makes undue or Excess claim of ITC.
Hence , Interest is applicable