2005 (11) TMI 7 - AT - Central Excise

Period of Limitation for Demand U/S 11A where show cause notice is sued after 3 years of gathering all information on visit of officers

Summary

Issues:
Time bar for demands raised by the Department regarding the use of a brand name owned by another entity to claim SSI exemption.

Analysis:
1. The appellants contested the case on the grounds of time bar, not on merits, as the Department visited their factory on 5-11-1999 to verify records related to the use of the brand name "Melam" owned by another entity. The Department alleged that the appellants suppressed production and clearance of branded goods to evade duty, denying them the SSI Exemption.

2. The contention was that the Show Cause Notice issued on 25-7-2002 was belated, collected information on 5-11-1999, and demands were time-barred. The appellants believed they were eligible for exemption, citing the Namtech Systems Ltd. case and Queen Electrical Industries case, where demands were set aside due to non-disclosure of brand name in declarations.

3. The SDR argued that the Namtech Systems Ltd. case did not apply as it involved a foreign brand name, and the Notification barred using another person's brand name for SSI exemption. Referring to the Queen Electrical Industries case and the BPL India Ltd. case, it was highlighted that non-disclosure of brand name does not protect demands from time bar if declarations were not filed.

4. The Tribunal considered the delayed Show Cause Notice issuance after three years, the Notification prohibiting the use of another person's brand name for exemption, and the BPL India Ltd. case regarding extended period invokability. Relying on the Indian Petrochem. Corpn. Ltd. case, the Tribunal allowed the appeals, granting the benefit of time bar due to the delayed issuance of the Show Cause Notice by the Department after three years, with consequential relief.