2005 (4) TMI 431 - AT - Central Excise

Summary

Issues:
Admissibility of Notification No. 208/83 to the manufacturing unit.

Detailed Analysis:
The issue in the present appeal revolves around the admissibility of Notification No. 208/83 to the manufacturing unit. The appellant, during the relevant period from 1983 to 1986, was availing exemption under this notification for manufacturing iron and steel products. The notification required re-rollable inputs and scraps to be duty paid, with the assumption that all scrap available in the market was duty paid unless proven otherwise. The appellant had filed a classification list approved by the Assistant Commissioner and maintained all necessary documentary records.

Subsequently, it was discovered that the inputs used by the appellant were non-duty paid ship breaking scrap, thus not meeting the conditions of the notification. A show cause notice was issued proposing duty demand and penalties. The Tribunal ruled that the benefit of the notification was not applicable due to the use of non-duty paid raw materials. However, the matter of limitation was sent back to the Commissioner for re-consideration.

In the de novo proceedings, the Commissioner held that the appellants suppressed information regarding the use of non-duty paid ship breaking scrap, justifying the invocation of a longer period for assessment. The appellant argued that ship breaking scrap did not have a specific identity during the relevant period and was deemed duty paid as purchased from the open market. They believed they were entitled to the notification's benefit in good faith.

The Commissioner noted that although an audit had taken place, the purchase bills did not bear any auditor's initial or signature, indicating wilful suppression by the appellants. However, the appellant's advocate presented a letter from the auditor requesting all documents, including purchase bills, for verification. It was established that the documents were maintained by the appellant and produced before the audit party, despite lacking initials. Consequently, the Tribunal found no merit in the Commissioner's reasoning and allowed the stay petition unconditionally on the point of limitation.

In conclusion, the Tribunal's decision centered on the appellant's compliance with the conditions of Notification No. 208/83, the alleged suppression of information, and the issue of limitation in the assessment process. The judgment highlighted the importance of maintaining statutory documents and demonstrating bona fide actions in dealings with the revenue authorities.