2005 (4) TMI 408 - AT - Central Excise

Summary

Issues:
1. Valuation of goods for excise duty.
2. Invocability of extended period of limitation.
3. Provisional assessment of clearances.

Valuation of Goods for Excise Duty:
The case involved the manufacture of "PTFE" tubes and fittings chargeable to excise duty at 20%. The issue arose when the Department suspected undervaluation of goods cleared for captive consumption compared to those cleared for home consumption. A show cause notice was issued invoking the extended period of limitation to recover differential duty and impose penalties. The assessee contended that the demand of duty was time-barred as there was no intent to evade payment. The Commissioner held in favor of the assessee, stating no misdeclaration or misstatement occurred. The Revenue appealed, arguing that assessments were provisional, citing relevant case law. However, the Tribunal found no evidence of misdeclaration to invoke extended limitation and upheld the Commissioner's decision, dismissing the Revenue's appeal.

Invocability of Extended Period of Limitation:
The central issue was whether the extended period of limitation could be invoked against the assessee due to misdeclaration or misstatement. The Revenue challenged the Commissioner's finding that assessments were not provisional during the disputed period. The appellant argued that assessments should be considered provisional, relying on case law. However, the Tribunal found no formal order of assessment or bond under Rule 9B to support provisional assessments. The Tribunal referred to the Supreme Court's judgment, emphasizing the need for an order under Rule 9B and payment of duty on a provisional basis for assessments to be considered provisional. As the Revenue failed to establish provisional assessments, the extended period of limitation could not be invoked based on this ground.

Provisional Assessment of Clearances:
The dispute also revolved around whether the clearances during the period in question were provisional. The Revenue contended that assessments should be deemed provisional, despite the absence of formal orders or bonds. The Tribunal rejected this argument, citing the Supreme Court's ruling that provisional assessments require compliance with Rule 9B and provisional duty payment. As there was no evidence of provisional assessments in this case, the Tribunal upheld the Commissioner's decision that the assessments were not provisional. The show cause notice did not raise the issue of provisional assessments to overcome the time-bar. Consequently, the Tribunal dismissed the Revenue's appeal, affirming that the demand of duty was time-barred.