2000 (5) TMI 355 - AT - Central Excise

Summary

Issues Involved:
1. Whether the Show Cause Notice (SCN) issued without quantification of demand is legal and valid.
2. Whether, during the material period, the Collector could adjudicate u/s 11A or if it was only the Assistant Collector who was empowered.

Issue-wise Summary:

1. Legality of SCN without Quantification of Demand:

- Arguments and Case Law:
- The Show Cause Notice (SCN) without quantification was debated. The Delhi High Court in Hindustan Aluminium Corporation Ltd. v. Supdt., Central Excise [1981 (8) E.L.T. 642] supported the issuance of SCN without quantification, emphasizing that details like quantity and period were sufficient.
- Contrarily, the Bombay High Court in J.B.A. Printing Inks Ltd. v. Union of India [1980 (6) E.L.T. 121] held that specifying the amount was a sine qua non for the validity of the SCN.

- Tribunal's Analysis:
- The Tribunal, agreeing with the Bombay High Court, stated that non-quantification could lead to disputes regarding the method of calculation and rate of duty. They emphasized that u/s 11A(1), the amount must be specified to avoid conjecture or speculation.
- The Tribunal also highlighted that u/s 11A(2), the determination of duty by the Central Excise Officer should not exceed the amount specified in the notice, implying the necessity of quantification in the SCN.

- Majority Decision:
- By majority, it was held that "A SCN issued without quantification of demand is not legal and valid."

2. Adjudication Authority u/s 11A:

- Arguments and Case Law:
- The second question regarding the authority of the Collector or Assistant Collector to adjudicate u/s 11A was already settled by another Larger Bench.

- Tribunal's Decision:
- The Tribunal agreed with the pre-existing decision that during the material period, the adjudication could be done by the Collector.

Separate Judgment:

- Dissenting Opinion:
- Member (T) Lajja Ram dissented, arguing that a SCN without quantification of demand is not illegal or invalid. He emphasized that the term 'specified' in Section 11A(1) does not necessarily mean 'determined' or 'quantified' and cited various judicial interpretations to support this view.
- He referenced the Delhi High Court's ruling in Hindustan Aluminium Corporation Ltd. v. Supdt., Central Excise, which held that the absence of exact quantification does not invalidate the SCN.

Final Decision:

- By Majority:
- It was held that "A SCN issued without quantification of demand is not illegal or invalid."

Conclusion:
The Tribunal, by majority, concluded that a SCN issued without quantification of demand is not illegal or invalid, aligning with the broader interpretation that specifying the amount in detail is not mandatory for the validity of the SCN. The adjudication authority u/s 11A during the material period was affirmed to be the Collector.