1988 (8) TMI 192 - AT - Central Excise

Summary

Issues:
1. Interpretation of Notification No. 80/80-C.E., dated 19-6-1980 for exemption under central excise.
2. Whether goods exempted from excise duty are still considered excisable goods.
3. Jurisdiction of Assistant Collector to issue show cause notice for recovery of refund.
4. Limitation period for issuing show cause notice.

Analysis:
1. The appeal involved the interpretation of Notification No. 80/80-C.E., dated 19-6-1980, regarding the exemption under central excise. The dispute arose when the Collector of Central Excise (Appeals) upheld the Assistant Collector's decision that the total value of clearances for the exemption should include goods produced without power from another factory, leading to the appellants being ineligible for the exemption due to exceeding the prescribed limit of Rs. 20 lakhs. Additionally, the claim that the show cause notice for refund recovery was time-barred was rejected.

2. The main contention was whether goods completely exempted from excise duty should be considered excisable goods for the purpose of determining eligibility for the exemption under Notification No. 80/80-C.E. The appellants argued that once goods are unconditionally exempted, they cease to be excisable goods. Citing precedents like Tata Export Limited v. Union of India and M/s. Madhav Mills Private Limited v. Collector of Central Excise, the appellants sought exemption. However, the Tribunal, in line with the decision in M/s. Techno Chemical Industries, held that even exempted goods remain excisable for the purpose of the notification, thus denying the appellants' claim.

3. The appellants raised concerns about the jurisdiction of the Assistant Collector to issue a show cause notice for refund recovery, citing the Madras High Court's decision in Madras Rubber Factory Ltd. v. Assistant Collector of Central Excise. The Tribunal discussed the power of review by excise officers, referring to various judgments, including the Supreme Court's ruling in Geep Flashlight Industries Ltd. v. Union of India. Ultimately, the Tribunal held that the Assistant Collector had the authority to issue the notice, dismissing the appellants' argument.

4. Regarding the limitation period for issuing the show cause notice, the Tribunal analyzed the date of refund and the date of notice issuance. Referring to the Supreme Court's decision in Geep Flashlight Industries Ltd. v. Union of India, the Tribunal determined that the relevant date for the limitation period is the date of actual refund, not the order for refund. Consequently, the show cause notice issued within six months of the refund was deemed within the statutory limit, rejecting the appellants' claim of limitation.

In conclusion, the Tribunal dismissed the appeal, upholding the decision on all grounds and ordering accordingly.