2010 (7) TMI 184 - HC - Central Excise

Demand Limitation Tribunal order holding suppression or mis-management by assessee absent and invocation of extended period not sustainable. Held that- contention of revenue that classification alone challenged before Supreme Court and Tribunal not having jurisdiction to entertain limitation issue, not acceptable as Tribunal s earlier order set aside by Supreme Court and matter remanded. Tribunal order sustainable.

Summary

Issues:
1. Challenge to order dated 4th December 2008 by the Customs, Excise & Service Tax Appellate Tribunal.
2. Jurisdiction of the Tribunal to entertain issues already decided by a coordinate Bench.
3. Exoneration of respondent from duty liability and penalty under Central Excise Act and Rules.

Analysis:
1. The Appellant-revenue challenged the order dated 4th December 2008 made by the Customs, Excise & Service Tax Appellate Tribunal (the Tribunal) on the grounds of invoking the extended period of limitation under the Central Excise Act. The Tribunal, in a previous order dated 22nd November 1994, had upheld the classifications and the extended period of limitation. However, the Supreme Court later set aside this order and remitted the case back to the Tribunal for reconsideration. The Tribunal, in the impugned order, upheld the classification but found that the extended period of limitation could not have been invoked in this case.

2. The Appellant argued that the Tribunal exceeded its scope of remand by considering the question of invoking a larger period of limitation. It was contended that the respondent had only challenged the order of the Tribunal regarding the classification dispute before the Supreme Court, not the limitation issue. However, the High Court rejected this argument, stating that once an order is challenged before a superior court, all aspects of the order can be considered. The Tribunal's consideration of the limitation issue was deemed appropriate within the scope of the remand.

3. Upon examining the Tribunal's order on merits, it was found that the Tribunal concluded there was no suppression or misstatement by the respondent to evade duty payment justifying the invocation of a longer period of limitation. The Tribunal held that the demand beyond the normal limitation period was not sustainable. The Tribunal also found that as there was no mala fide intent on the part of the respondent, the imposition of a penalty was not justified. The Tribunal's decision was based on factual findings, and it was held that no legal error was committed to warrant interference.

In conclusion, as there was no substantial question of law proposed, the appeal was dismissed. The Tribunal's decision regarding the limitation issue and exoneration of the respondent from duty liability and penalty was upheld based on factual findings and legal interpretation.