2006 (9) TMI 253 - SC - Central Excise

Demand- Limitation- exemption under Notification No. 71/78 dated 1-3-1978- Appellant manufactures refrigerating and air conditioning machinery, appliances and parts thereof falling under Tariff item 29A of the then Central Excise Tariff. It claimed exemption under Notification No. 71/78 dated 1-3-1978. The claim of the appellant for exemption under Notification No. 71/78 was rejected. Held that- the appellant, raised a point before the Tribunal was relating to reworking out of the assessable value under Section 4(4)(d)(ii) of the Act and the extended period of limitation cannot be invoked as it is beyond the time period. The Tribunal did not permit the argument to be raised as the same had not been raised before the other authorities. thus, these appeals are allowed and the demand raised against the appellant for the year 1978-1979 is hereby dropped.

Summary

Issues:
Appeal against Final Order, Time limitation of Show Cause Notice, Provisional assessments, Relevance of Rule 9B, Interpretation of previous judgments, Assessable value under Section 4(4)(d)(ii).

Analysis:
The case involved appeals against Final Order Nos. 276-277/2001-B passed by the Customs, Excise & Gold (Control) Appellate Tribunal, New Delhi. The main issue raised was the timeliness of the Show Cause Notice dated 4-3-1980, which the appellant argued was beyond the six-month period and therefore time-barred. The period in question was the financial year 1978-1979.

The appellant, a manufacturer of refrigerating and air conditioning machinery, had filed a classification list claiming exemption under Notification No. 71/78 dated 1-3-1978. The Assistant Collector approved the classification list on 17-12-1979 but rejected the exemption claim. A demand for duty was raised against the appellant on 26-12-1979, leading to a series of appeals and orders.

The Assistant Collector issued a show cause notice on 4th March 1980, within six months of the approval of the classification list, denying the exemption claimed by the appellant. The appellant contended that assessments made until the approval of the classification list should be considered provisional, citing the decision in Samrat International Pvt. Ltd. v. CCE Indore.

However, subsequent judgments in Metal Forgings v. Union of India and Hindustan National Glass & Indus. Ltd. v. Commissioner of Central Excise, Calcutta clarified that assessments cannot be treated as provisional until the classification list is approved. As the show cause notice in this case was issued beyond the six-month period, it was deemed time-barred.

Another point raised by the appellant regarding the reworking of the assessable value under Section 4(4)(d)(ii) was not addressed as the show cause notice was already considered time-barred. Consequently, the appeals were allowed, and the demand raised against the appellant for the year 1978-1979 was dropped, with each party bearing their own costs.