2017 (12) TMI 697 - AT - Central Excise

Valuation - job-work - demand of differential Central Excise duty from the appellant for the period 1993-94 on the ground that appellant had undervalued the goods cleared from the factory premises - time limitation - Held that - If there is a declaration filed by the appellant on 13.04.1994, show cause notice issued on 13.10.1994 for demanding the duty liability for the period 1993-94, seems to be hit by limitation, as the declaration filed by the appellant includes the details of the valuation of goods cleared from the factory premises - appellant had filed declaration on 13.04.1994, hence question of limitation needs to be reckoned from this date. SCN hit by time limitation - appeal allowed - decided in favor of appellant.

Summary

Issues:
- Differential Central Excise duty demand for the period 1993-94 due to undervaluation of goods cleared by the appellant.
- Applicability of limitation period for raising the demand based on the date of filing the declaration by the appellant.

Analysis:
1. Differential Central Excise Duty Demand: The appeal was against the Order-in-Appeal No:128/2007 regarding the demand of differential Central Excise duty for the period 1993-94, alleging undervaluation of goods cleared by the appellant. The appellant, a job worker, cleared final products after availing SSI exemption. The issue revolved around the timing of filing a declaration by the appellant, which included details of transactions undertaken. The show cause notice for demanding the duty liability was issued on 13.10.1994, based on the alleged undervaluation. The first appellate authority's findings suggested that the demand for the subsequent period could be raised within the time limit prescribed under Section 11A of the Central Excise Act, 1944. However, the appellate tribunal found these findings to be inconsistent with the law, as the declaration filed by the appellant on 13.04.1994 should have triggered the limitation period from that date itself.

2. Applicability of Limitation Period: The key point of contention was the starting point for calculating the limitation period for raising the demand. The Revenue argued that the limitation should be considered from 15.04.1994, the last date for filing the declaration. However, it was undisputed that the appellant had filed the declaration on 13.04.1994. The tribunal held that the limitation period should be reckoned from the actual date of filing by the appellant, i.e., 13.04.1994. Therefore, the show cause notice dated 13.10.1994, demanding the duty liability for the period 1993-94, was deemed to be hit by limitation. Consequently, the impugned order was set aside, and the appeal was allowed in favor of the appellant.

In conclusion, the appellate tribunal ruled in favor of the appellant, setting aside the demand for differential Central Excise duty for the period 1993-94 due to undervaluation. The decision was primarily based on the correct interpretation of the limitation period, which was deemed to start from the date of filing the declaration by the appellant. The judgment emphasized the importance of adhering to legal timelines and procedures in matters concerning duty liabilities and declarations under the Central Excise Act, 1944.