1988 (4) TMI 147 - AT - Central Excise

Summary

Issues:
1. Interpretation of Rule 10 in relation to duty concession availed by respondents under Notification No. 198/76.
2. Application of Rule 173F of Central Excise Rules regarding the duty of the assessee to point out mistakes in base clearances.
3. Allegation of suppression of fact by the department and awareness of mistake by the assessee.
4. Consideration of the extended period for raising duty demands and the concept of limitation in duty disputes.

Analysis:
The case involved respondents who availed production incentives under Notification No. 198/76 but were later issued a show cause notice demanding duty due to alleged incorrect base clearances. The Collector (Appeals) set aside the duty demand as time-barred, leading the department to appeal. The department argued that Rule 10 applied due to wrong base clearances, citing precedents. However, the department later changed its grounds, alleging suppression of fact by the assessee under Rule 173F. The respondents contended that the base clearances were correctly determined and there was no suppression. The tribunal noted that the department failed to prove deliberate suppression or awareness of mistake by the respondents, emphasizing that the appeal was allowed solely on the basis of limitation. The tribunal held that invoking the extended period without substantiated allegations was unjustified, leading to the dismissal of the appeal.

In the context of Rule 10, the tribunal examined the application of duty concessions and the department's attempt to invoke Rule 173F. The department's shifting grounds from Rule 10 to suppression of fact raised questions about the validity of the duty demand. The tribunal emphasized the importance of the normal period for raising duty demands and the lack of evidence supporting the department's allegations of awareness of mistakes by the assessee. Ultimately, the tribunal found no reason to overturn the Collector (Appeals) decision, highlighting the significance of adherence to statutory limitation periods in duty disputes.