2007 (1) TMI 469 - AT - Central Excise

Summary

Issues:
1. Time-barred demand for differential duty based on amended circular issued by Ministry of Food and Civil Supplies.
2. Applicability of extended period of limitation under Section 11A for issuing show cause notice.

Analysis:
1. The appellants contested a demand for differential duty based on an amended circular issued by the Ministry of Food and Civil Supplies. The appellants argued that the demand was time-barred as the circular was amended in 1989, and the show cause notice was issued in 1993 for the sugar seasons 1988-89 to 1990-91. They claimed that since the amended circular was within the Revenue's knowledge, there was no suppression on their part. However, the Revenue contended that the amended circular, restricting benefits, was communicated only to the sugar factories, and since the appellants did not pay duty as per the circular, the demand was not time-barred.

2. The Revenue issued the show cause notice under the proviso to Section 11A, revoking the extended period of limitation, to demand the differential duty. The appellants had availed benefits under the policy issued in 1983 by the Ministry of Food and Civil Supplies, which was later amended in 1989. It was established that the appellants were not entitled to the benefits claimed under the amended policy. The Tribunal noted that the appellants were aware of the amendment as it was communicated to all sugar factories. As the appellants continued to claim benefits under the original policy despite being aware of the amendment and their ineligibility, the Tribunal found no merit in their contentions. Consequently, the appeal was dismissed.