1998 (5) TMI 232 - AT - Central Excise

Summary

Issues:
1. Waiver of pre-deposit and stay of recovery of duty and penalty.
2. Point of limitation regarding the show cause notice.
3. Allegation of wilful mis-statement and suppression of facts.
4. Invocation of the limitation period.
5. Change of opinion regarding classification lists.

Analysis:
1. The appellant sought waiver of pre-deposit and stay of recovery of duty and penalty amounting to Rs. 26,61,008.40 demanded for the period 1991-92 to 31-8-1994. The appellant was engaged in manufacturing a 'billing & accounting' machine for STD/ISD telephone accounting.

2. The appellant argued that the show cause notice issued on 28-7-1995 was time-barred as the manufacturing operations had commenced in June 1991, and various interactions and submissions had taken place with the authorities prior to the notice. The Assistant Commissioner had released the seized machines in 1992 after being satisfied with the explanations provided. The appellant contended that the demand of duty was hit by limitation as no wilful mis-statement or suppression of facts was alleged.

3. The appellant emphasized that no wilful mis-statement or suppression of facts was involved in the case, and therefore, the demand of duty was beyond the normal limitation of six months. The appellant sought unconditional allowance of the stay petition based on the limitation ground.

4. The Respondents, however, argued that the Commissioner had found discrepancies in the classification lists submitted by the appellant in March 1993, leading to wrong classification and duty evasion. The Respondents invoked the limitation of five years based on these findings.

5. Upon considering the arguments from both sides and reviewing the show cause notice, the Tribunal observed that the notice primarily referred to the classification lists submitted in 1993 without acknowledging the events of 1992 when the machines were examined and released by the Assistant Commissioner. The Tribunal opined that it seemed to be a case of a change of opinion between different sets of officers, and thus, the larger limitation period could not be invoked. Consequently, the Tribunal unconditionally allowed the stay petition without delving into the merits of the classification lists.