1980 (2) TMI 90 - CGOVT - Central Excise

Goods removed with knowledge of department - Exemption - Burden of Proof. - Ioqin tablets and ampoules

Summary

Issues:
1. Eligibility for concessional rate of duty under notification No. 116/69 for Ioquin tablets and ampoules.
2. Imposition of penalty and recovery of differential duty.
3. Evidence and expert opinions considered in the decision-making process.
4. Application of Rule 173-Q and limitation periods for duty recovery.
5. Judicial precedents and legal interpretations influencing the judgment.

Detailed Analysis:
1. The case involved the eligibility of a petitioner-firm for a concessional rate of duty under notification No. 116/69 for Ioquin tablets and ampoules. The firm claimed that Ayurvedic ingredients were added for psychological effects, not to alter the therapeutic value provided by Quinine. However, the Collector of Central Excise held that the conditions for the lower duty rate were not met, leading to the imposition of a penalty and demand for differential duty.

2. The petitioner-firm's appeal to the Board resulted in a reduction of the penalty but upheld the duty demand. Subsequently, in a revision application, the firm argued various grounds, including reliance on expert reports and past government decisions favoring similar products for lower duty rates.

3. The revision application highlighted discrepancies in the consideration of expert reports by Excise Authorities, emphasizing the importance of fulfilling conditions for availing the concessional rate of duty. The petitioner argued that despite lacking evidence for meeting specific conditions, they had made bona fide declarations and were not evading duty intentionally.

4. The judgment discussed the invocation of Rule 173-Q for duty recovery and addressed the issue of limitation periods under Section 40(2) of the Act. Legal interpretations from different High Courts were considered, determining the applicability of limitation provisions in the case.

5. Government observations emphasized the petitioner's failure to prove eligibility for the lower duty rate, citing expert opinions and lack of evidence supporting their claims. Judicial precedents were referenced to assess the petitioner's compliance with duty regulations and the department's awareness of the duty discrepancies over time.

In conclusion, the Government rejected the petitioner-firm's claim for the concessional duty rate but set aside the penalty based on the findings related to intent and past departmental approvals. The judgment highlighted the importance of meeting statutory conditions for duty benefits and the significance of evidence and expert opinions in excise duty disputes.