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2016 (5) TMI 992 - AT - Central ExciseExtended period of limitation - Demand of consequential duty and imposition of penalty - Denial of discount - Non-compliance of prescribed condition of Notification No. 245/83 - Appellant while claiming the discount of the price list have withheld vital information in as much as they have not submitted the documents showing the medicines has been specified in the DPCO 1987 and not declared at the footnote of the price list that the medicines figured in DPCO - Held that - Member (J) found that there is no suppression of the fact on the part of the appellant in as much as they have correctly declared all the details required in their price lists. Therefore it was only normal period of one year available to the department to re-open the approval of price list which the department failed to do so and therefore entire demand raised for the extended period is time barred. Member (T) held that in absence of evidence to substantiate the claim that the prices are approved under DPCO, the assertion made on the price list submitted to revenue under Central Excise Law amounts to mis-declaration with intent to fraudulently avail the exemption. Therefore, the extended period of limitation has been rightly invoked. Difference of opinion - The Registry is directed to put up the file before the Hon ble President to resolve the issue, by reference to a third Member.
Issues Involved:
1. Interpretation of Notification No. 245/83 regarding discount on Maximum Retail Price. 2. Compliance with conditions of Notification No. 245/83 and Drug (Price Control) Order, 1987. 3. Invocation of extended period of limitation for duty demand. 4. Burden of proof in cases of mis-declaration and fraud. Analysis: Issue 1: Interpretation of Notification No. 245/83 The appellant claimed a 15% discount on Maximum Retail Price (MRP) under Notification No. 245/83. The dispute arose as the authorities alleged non-compliance with the condition that MRP should be specified in the Drug (Price Control) Order, 1987. The appellant argued that they had declared the MRP as per DPCO 1987 in the price lists approved by the authorities. The Tribunal noted that the department approved the price lists despite knowledge of the claimed MRP under DPCO. It was held that there was no suppression of facts by the appellant, and the demand was not sustainable as the extended period for re-opening the approval of price lists was time-barred. Issue 2: Compliance with Conditions of Notification No. 245/83 and DPCO 1987 The appellant contended that they had correctly declared the MRP under DPCO 1987 in the price lists, which were approved by the authorities. The department argued that the appellant failed to prove that the claimed prices were approved under DPCO 1987. The Tribunal emphasized the burden of proof on the appellant to substantiate their claim. It was observed that the appellant's failure to provide evidence of approval under DPCO implied mis-declaration with fraudulent intent to avail exemptions. The Tribunal upheld the invocation of the extended period of limitation due to clear evidence of mis-declaration and fraud. Issue 3: Invocation of Extended Period of Limitation The Tribunal deliberated on whether the extended period of limitation could be invoked in the case. The Member (Judicial) held that the demand was time-barred due to lack of suppression of facts by the appellant. In contrast, the Member (Technical) found clear evidence of mis-declaration and fraud, justifying the invocation of the extended period. The difference of opinion led to the appeal being referred to the Hon'ble President for resolution by a third Member. In conclusion, the Tribunal's judgment focused on the correct interpretation of Notification No. 245/83, compliance with DPCO 1987, the invocation of the extended period of limitation, and the burden of proof in cases of mis-declaration and fraud. The detailed analysis of each issue provided clarity on the legal aspects involved in the case, leading to a thorough examination of the facts and legal principles.
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