1992 (7) TMI 163 - AT - Central Excise

Summary

Issues:
Rectification of mistake in the order regarding time-barred demand under Section 11A.

Analysis:
The Appellate Tribunal received a miscellaneous application from the Revenue seeking rectification of a mistake in an order regarding a demand for Rs. 3,58,303.20 issued on 29-2-1988 for goods cleared between 1-4-1987 to 23-12-1987, which was considered time-barred due to lack of evidence of wilful misstatement or suppression of facts justifying the extended 5-year period under Section 11A. The Revenue contended that only a part of the demand was time-barred and should have been confirmed for a period of 6 months from August 1987 onwards. The Tribunal found an error in holding the entire demand as time-barred and ordered rectification.

The Revenue argued that the demand for the period August 1987 onwards, falling within the normal 6-month period, should have been enforceable as the extended period under Section 11A was not applicable based on the facts of the case. The Tribunal acknowledged the mistake in its order and agreed to rectify it to reflect the correct period for which the demand was enforceable.

The appellant's advocate contended that the goods were assessed based on a longstanding practice and any change in assessment practice should be prospective, citing relevant case law. He argued that there was no error apparent in the Tribunal's order setting aside the entire demand and that it could not be revised under Section 35C(1). The Tribunal, however, found the error in its order due to the lack of evidence supporting wilful misstatement or suppression of facts, leading to the demand being set aside as time-barred.

The Tribunal clarified that under Section 35C(2), it could rectify only mistakes apparent from the record and not review its own orders or consider new material or arguments. Therefore, it was unnecessary to address the appellant's contentions regarding the assessment practice change being prospective. The Tribunal rectified the order to specify the correct period for which the demand was enforceable, ensuring that any short levy would be recoverable only for goods cleared within the normal 6-month period from the date of the show cause notice.