2014 (1) TMI 7 - HC - Central Excise

Following the precedent Onus to prove Invocation of Extended period of limitation for time barred demand Held that - The Tribunal was justified in recording the findings - it was not possible to ascribed any willful suppression or mis-statement on the part of the assessee for not paying excise duty Relying upon Continental Foundation Jt. Venture v. CCE, Chandigarh 2007 (8) TMI 11 - SUPREME COURT OF INDIA - the activity of cutting, bending, bunching of plats or channels in which the assessee was engaged, did not amount to manufacturing activity - when there was bona fide doubt as to non-excisability of the goods, the extended period of 5 years cannot be invoked - Mere failure or negligence in not taking license or not paying duty, is not sufficient for invoking extended period. It cannot be said that the conduct of the assessee was not bona fide - When the activity undertaken by it was not treated as manufacture, it would not have been expected to pay the excise duty the contention of the appellant that there was a suppression of facts and payment of duty was intentionally evaded by the assessee cannot be accepted Decided against Appellant.

Summary

Issues:
- Appeal challenging order of Central Excise and Services Tribunal
- Alleged evasion of excise duty
- Question of limitation in invoking extended period
- Bona fide doubt on excisability of goods
- Tribunal's findings on suppression or misstatement
- Justification of Tribunal's decision

Analysis:
1. The appeal was filed by the Department to challenge the order of the Central Excise and Services Tribunal regarding the imposition of excise duty on finished goods allegedly cleared without registration. The Tribunal considered the issue of limitation in invoking the extended period for demand of excise duty.

2. The assessee, engaged in manufacturing fabricated iron and steel structures, was visited by Excise Officers based on specific information. A show cause notice was issued calling for payment of excise duty amounting to Rs. 41,04,217 for goods cleared during 1998-1999 and 1999-2000. The Tribunal found the show cause notice time-barred as it was issued in 2003 for the mentioned period.

3. The Tribunal dismissed the department's appeal, stating that no suppression or misstatement could be attributed to the assessee due to divergent views in previous judgments. The Tribunal held that demand raised beyond the limitation period by invoking the extended period was unjustified, as there was no willful evasion on the part of the assessee.

4. The Tribunal's decision was supported by legal precedents, including a Supreme Court ruling, which emphasized that in cases of bona fide doubt on excisability of goods, the extended period cannot be invoked. The Tribunal concluded that the assessee's conduct was bona fide, and there was no intentional evasion of excise duty.

5. Ultimately, the Tribunal's decision was upheld, and it was deemed that no error was committed in dismissing the appeal. The Tribunal's findings regarding the absence of suppression or misstatement by the assessee were considered valid, and the appeal was dismissed for lacking merit.

This detailed analysis outlines the key issues raised in the legal judgment, the Tribunal's reasoning, and the final decision in favor of the assessee based on the lack of willful evasion and the presence of bona fide doubt regarding excisability of goods.