1995 (5) TMI 132 - AT - Central Excise

Summary

Issues Involved:
1. Timeliness and validity of the notice of intention to avail exemption.
2. Compliance with conditions specified in the exemption notification.

Detailed Analysis:

1. Timeliness and Validity of the Notice of Intention to Avail Exemption
The appellants argued that they sent the notice of intention to avail the exemption on 14-11-1983 under a certificate of posting, which was received by the Assistant Collector on 28-11-1983. The Assistant Collector rejected the claim on the grounds that the notice was not filed within one month from the publication of the notification or within an extended period allowed by the Collector of Central Excise. The appellants contended that the time frame was directory, not mandatory, and that the delay due to postal services was condonable. They cited the Tribunal's decision in Nayankumar P. Shah v. Additional Collector of Customs and other cases to support their argument that the procedural requirement was met.

The Tribunal found that although the mode of service was not prescribed in the notification, the notice sent on 14-11-1983 should be considered valid. The Tribunal noted the importance of the document and questioned why it was sent by certificate of posting on the last date. Despite this, the Tribunal held that the notice was valid, considering the Collector had the power to extend the period.

2. Compliance with Conditions Specified in the Exemption Notification
The appellants claimed that they opted for condition (b) of the notification, which required the content of rice bran oil in the mixture to be in excess of one percent before hydrogenation. The Assistant Collector denied the exemption, stating that the appellants failed to demonstrate the usage of rice bran oil as specified. The appellants argued that the show cause notice did not address the merits but only the timeliness of the notice.

The Tribunal clarified that the show cause notice referenced both conditions (a) and (b), and the appellants needed to fulfill these conditions to avail the exemption. It was determined that the adjudicating authority did not go beyond the show cause notice. The Tribunal emphasized that the appellants needed to substantiate their claim regarding the usage of rice bran oil as per condition (b).

Conclusion:
The Tribunal concluded that the notice sent on 14-11-1983 was valid, but the appellants needed to fulfill the conditions specified in the notification to avail the exemption. The case was remanded to the Assistant Collector to re-examine the issue on merits and provide the appellants an opportunity to substantiate their claim in accordance with clause (b) of the notification. The appeal was allowed by way of remand.