2004 (2) TMI 405 - AT - Central Excise

Issues:
1. Barred by limitation - Show cause notices issued beyond the statutory period.
2. Applicability of extended period of limitation under section 11A.
3. Prima facie view on demand being barred by limitation.

Analysis:

Issue 1: Barred by limitation - Show cause notices issued beyond the statutory period
The judgment addresses the issue of whether the demand raised through show cause notices issued beyond the statutory period is barred by limitation. In the case of Appeal Nos. 836 and 837/2002, show cause notices were issued on 16-10-2001 for the period April 1994 to June 1996, which exceeded the five-year limitation period. The Commissioner justified the delay by referring to a letter from the Superintendent in 1999, but the appellant argued that such communication cannot replace a formal show cause notice. Citing the Supreme Court's decision in Metal Forgings case, the Tribunal agreed that the law mandates a specific format for show cause notices, and any other communication cannot serve as a substitute. Consequently, the Tribunal held that the demand in these cases was prima facie barred by limitation.

Issue 2: Applicability of extended period of limitation under section 11A
In Appeal No. 835/2002, the period in question was from April 1994 to June 1996 and then extended to June 2000, with the show cause notice issued on 16-10-2001. The Tribunal noted that the first part of the demand exceeded the five-year limit, while the second part went beyond the one-year normal period under section 11A. Examining the correspondence between the appellant and the Revenue regarding FDZ charges, the Tribunal concluded that the extended period of limitation was not applicable to the Revenue. As a result, the Tribunal allowed all three stay petitions based on this finding.

Issue 3: Prima facie view on demand being barred by limitation
Considering the facts of the cases and the legal precedents, the Tribunal took a prima facie view that the demands raised in the appeals were indeed barred by limitation. By emphasizing the importance of adhering to the statutory timelines for issuing show cause notices and the limitations prescribed under section 11A, the Tribunal highlighted the significance of procedural compliance in such matters. This approach underscores the Tribunal's commitment to upholding the principles of natural justice and statutory provisions in tax matters.

In conclusion, the judgment by the Appellate Tribunal CESTAT, Kolkata, provides a detailed analysis of the issues related to limitation periods for show cause notices and the applicability of extended limitation periods under section 11A. The Tribunal's decision reflects a strict adherence to legal requirements and precedents in determining the validity of demands raised by the Revenue, ensuring procedural fairness and compliance with statutory provisions.

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