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2017 (12) TMI 4 - AT - Central ExciseExtended period of limitation - denial of benefit of N/N. 41/99-CE dated 26.11.99, 13/2003 dated 01.03.2003 and 43/2003 dated 14.05.2003 on the ground that the condition of procurement of tea leaves from small growers not fulfilled - Held that - the respondent had intimated all the details regarding the availment of Notification to the department in terms of N/N. 41/99, the department has not been able to establish the suppression of facts with intention to evade payment of duty. Therefore, the extended period is not invokable. The Commissioner (Appeals) had relied upon the case of HAVUKAL TEA & PRODUCE CO. (P) LTD. Versus COMMISSIONER OF C. EX., SALEM 2008 (7) TMI 685 - CESTAT, CHENNAI . That the department had filed appeal before the Hon ble High Court of Madras against the said decision of the Tribunal - The main ground taken by the department is that the said decision has been appealed before the Hon ble jurisdictional High Court. However as fairly conceded by the Ld. AR, Hon ble High Court of Madras has dismissed the appeal thereby upholding the decision of the Tribunal. Appeal dismissed - decided against Revenue.
Issues Involved:
1. Eligibility for exemption under specific notifications. 2. Allegations of duty evasion and penalty imposition. 3. Adjudication by original authority and appeal before Commissioner (Appeals). 4. Dismissal of appeal by Hon'ble High Court of Madras. 5. Grounds of limitation and suppression of facts. Analysis: Issue 1: Eligibility for exemption under specific notifications The case involved the respondent allegedly manufacturing black tea and clearing it without payment of duty by availing exemption under Notification No. 4/99-CE, 13/2003, and 43/2003. The eligibility criteria required tea leaves to be procured from small growers with less than 10 hectares of land. However, investigation revealed that the tea growers did not meet this criterion, rendering the respondent ineligible for exemption. Issue 2: Allegations of duty evasion and penalty imposition Following the investigation, a show cause notice (SCN) was issued alleging duty evasion, demanding duty payment along with interest, and imposing penalties. The original authority confirmed the demand, interest, and penalties, including a separate penalty on the Managing Partner of the respondent. The Commissioner (Appeals) later set aside the demand on the ground of limitation, leading to the department appealing before the Tribunal. Issue 3: Adjudication and appeal process During the appeal, the Department argued that the Commissioner (Appeals) wrongly relied on a previous Tribunal decision and that the evidence showed the village authority's certificate was inaccurate. The respondent, represented by a consultant, contended that the certificate was based on true facts, and the department misinterpreted the land holdings of the tea growers. The Commissioner (Appeals) decision was supported by the respondent, emphasizing that all necessary details were provided to the department. Issue 4: Dismissal of appeal by Hon'ble High Court of Madras The Department's appeal before the Hon'ble High Court of Madras against a previous Tribunal decision was dismissed, reinforcing the Tribunal's decision. This dismissal played a crucial role in the Tribunal's ruling on the present case. Issue 5: Grounds of limitation and suppression of facts The Tribunal held that the department failed to establish the suppression of facts with the intention to evade duty payment, making the extended period inapplicable. The Commissioner (Appeals) decision to set aside the demand on the ground of limitation was upheld, emphasizing that all relevant information was disclosed to the department as required by Notification No. 41/99. In conclusion, the Tribunal dismissed one appeal due to the respondent's demise and upheld the Commissioner (Appeals) decision in another appeal, emphasizing the lack of suppression of facts and the inapplicability of the extended period for duty payment evasion.
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