1990 (6) TMI 193 - AT - Central Excise

Summary

Issues:
- Barred by limitation of review show cause notice
- Jurisdiction of the Collector to issue addendum
- Validity of determining assessable value under Rule 6(b)(i)
- Comparable goods for valuation

Analysis:

The appeal involved a dispute regarding the assessable value of metal containers manufactured by the appellants. The Asstt. Collector initially determined the value at Rs. 53.58 per 100 containers, which was later revised to Rs. 51.41 after a remand by the Collector. Subsequently, the Collector issued a notice proposing to review the order under old Section 35A beyond the 6-month limitation period specified. The appellants contended that the review notice was time-barred and challenged the Collector's jurisdiction to issue an addendum proposing a new ground for valuation under Rule 6(b)(i) of the Valuation Rules of 1975.

The Collector justified the show cause notice's timing by citing Section 35A(4), which allows proceedings within one year for decisions not related to short levy or non-levy. The Tribunal agreed with the Collector, emphasizing that the matter pertained to price list approval and not short levy, hence the notice was within the limitation period. The appellants failed to provide contrary authority.

Regarding the Collector's jurisdiction, the appellants argued that the addendum introducing a new valuation rule was beyond the Collector's authority, as he could only examine the legality of the Asstt. Collector's record. The Tribunal concurred, stating that an addendum should rectify defects related to existing records, not introduce new grounds. Issuing a new case via addendum was deemed impermissible, especially when it would be time-barred if treated as a fresh show cause notice.

The Tribunal emphasized that revisional inquiries should supplement existing records, not create new cases. Citing a previous case, they differentiated situations where further inquiries were warranted due to procedural irregularities from cases where new grounds were introduced improperly. The Tribunal distinguished a precedent cited by the respondent, where the Collector revised proceedings due to procedural lapses, unlike the present case where a new case was attempted through the addendum.

Ultimately, the Tribunal held that the addendum exceeded the Collector's jurisdiction and was time-barred, leading to the appeal's success and the set-aside of the Collector's order. The other grounds raised by the appellants were not considered due to the addendum's invalidity.