2004 (7) TMI 452 - AT - Central Excise

Summary

Issues:
1. Whether goods cleared for export can be considered a separate class of buyers compared to goods cleared for home consumption.
2. Whether there was an intention to evade duty and suppression of facts for invoking a larger period.

Issue 1:
The appeal dealt with whether goods cleared for export could be treated as a distinct class of buyers compared to goods cleared for home consumption. The Tribunal referenced the Apex Court judgment in Basant Industries v. Addl. Commissioner of Customs, Bombay, which established that clearances for export should be treated as a separate class of buyers. Additionally, the Tribunal cited the case of CCE v. Jayshree Chemicals Ltd., where varying prices for different classes of buyers were accepted. The appellants argued that export prices were influenced by international market competition and fluctuating prices, justifying different pricing for foreign buyers. The Tribunal agreed, emphasizing that export prices were based on different business considerations than prices for goods sold domestically. It was concluded that there was no undervaluation for export goods, and the appeal was allowed based on this reasoning.

Issue 2:
Regarding the intention to evade duty and suppression of facts, the Tribunal noted that the period in question exceeded six months from the relevant dates. The appellants had provided all necessary documentation for both home consumption and export sales, asserting no intent to evade duty. The Tribunal disagreed with the Department's arguments, stating that there was no suppression of facts or misrepresentation by the appellants. It was emphasized that the Department should have issued a show cause notice within the statutory time limit if comparable prices for home consumption were available. As the notice was issued beyond the six-month period and no intent to evade duty was found, the Tribunal held that the larger period could not be invoked. Consequently, the demands were deemed time-barred, and the Tribunal set them aside on this basis.

This comprehensive analysis of the judgment highlights the key legal issues addressed by the Appellate Tribunal CESTAT, Bangalore, emphasizing the interpretation of export goods as a separate class of buyers and the considerations regarding the intention to evade duty and suppression of facts.