Sorry ,yes you apply it here !
'C'est interdit'
Not necessarily will be the consonant taken over as the initial sound of the following word, when it commences with a vowel as in 'ont'.
In order for a liaison to be possible, it must end in a LATENT consonant. A latent consonant is simply a final consonant that is normally silent (as in petit ,ont ,interdit etc..).
Example:
Nous avons un petit enfant ( here the 's' in nous and 't' in petit are latent consonants.)
C'est interdit ( here 't' is a latent consonant)
Another example is 'et' ,the consonant 't' here is not a latent one, thus you don't liaise ' et aussi' ,you can google it ,it is not liased.
Liaison operates in word sequences whose components are closely linked by sense, e.g :
article + noun
adjective +noun
personal pronoun + verb
etc..
That might help you know when to use it or not ,but usually with practice you will know automatically .