2006 (2) TMI 487 - AT - Central Excise

Summary

Issues:
1. Time-barred demands raised by the Revenue.
2. Allegation of mis-statement or suppression of material information.
3. Exemption under Notification No. 78/90-CE.
4. Differential duty appeal by the Revenue.
5. Tribunal's ruling applicability.
6. Evasion of duty.
7. Concessional rate of duty.
8. Procedural lapse condoned by the Department.
9. Sustainability of duty payment for a larger period.

Analysis:
1. The case involved a Revenue appeal against Order-in-Appeal No. 16 and 42/04-CE dated 26-2-2004, where the Commissioner (A) noted that the demands were time-barred. The Commissioner found no mis-statement, suppression of material information, or fraud by the assessee at the time of clearing the goods. The issue arose regarding the clearance of goods without the required certificate under Notification No. 78/90-CE dated 20-3-1990, which granted an exemption subject to specific conditions. Despite a Departmental audit objection, the show cause notice was not issued within the stipulated time, leading to the Commissioner allowing the assessee's claim on the time bar but modifying the appeal on differential duty.

2. The Tribunal, comprising Dr. S.L. Peeran and Shri T.K. Jayaraman, considered both sides and observed that the demands were not raised within the prescribed time limit. It was highlighted that there was no intentional evasion of duty, suppression of information, or deliberate misstatement. The Tribunal referenced a previous ruling in the case of Haryana Roadways Engineering Corporation Ltd. v. CCE, New Delhi to support the decision. The Tribunal deemed the Commissioner's order legal and proper, emphasizing that the procedural lapse in following the exemption conditions was condoned by the Department itself, and the duty demand for a larger period was deemed unsustainable.

3. The Tribunal concluded that the assessee was entitled to the concessional rate of duty, and any duty payment demand for a larger period due to a procedural lapse was unwarranted. The appeal by the Revenue was rejected based on the findings that there was no deliberate evasion of duty, and the Department had allowed the assessee to follow a certain procedure despite later objections raised during the audit. The Tribunal's decision was based on the lack of merit in the Revenue's appeal, ultimately upholding the Commissioner's ruling in favor of the assessee.