1992 (3) TMI 182 - AT - Central Excise

Summary

Issues:
1. Eligibility for duty exemption under Notification No. 101/66 for acid slurry falling under TI 15AA.
2. Limitation period for the demand of duty for the period 1983-84 and 1984-85.

Analysis:

Issue 1:
The case involved determining whether acid slurry manufactured by the respondents is eligible for duty exemption under Notification No. 101/66. The Collector observed that the charge of circulation of cold water around the sulphonator inside the jacket was not substantiated. The Collector accepted the defense that transfer of raw materials before the manufacturing process started does not amount to the use of power in the manufacturing process. The Collector also noted that no process was ordinarily carried on with the aid of power, leading to the dropping of the case proceedings. However, upon review, the Tribunal held that the acid slurry manufactured by the respondents is not eligible for the duty exemption under Notification 101/66, overturning the Collector's decision.

Issue 2:
Regarding the limitation period for the demand of duty for the years 1983-84 and 1984-85, the respondents argued that there was no suppression of facts as the Departmental officers were aware of the manufacturing process due to frequent visits. The respondents had been filing details of clearances and declarations. The Collector based his decision on the visits of Departmental officers to the factory, concluding that no charge could be made for the suppression of relevant information. However, the Tribunal found that the Collector did not adequately consider the documentary evidence provided by the respondents. Citing a Supreme Court decision, the Tribunal remanded the matter to the adjudicating authority for a fresh determination on the issue of whether the demand was time-barred based on the evidence presented by the respondents.

In conclusion, the Tribunal set aside the Collector's decision on the merits and remanded the issue of the limitation period for further adjudication. The appeal was disposed of accordingly.