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TMI Blog1986 (10) TMI 148X X X X Extracts X X X X X X X X Extracts X X X X ..... -agents, the department found that the handling charges varying from Rs. 10/- to Rs. 20/- per M.T. were recovered from the customers and the sale tax was also paid on the said handling charges. As these charges were not declared in the price list, on 2-11-1976 the Superintendent of Central Excise issued a demand show cause notice for Rs. 3,65,616.79 under Rule 10A of the Central Excise Rules, 1944, in respect of cement cleared during the period from October, 1974 to September, 1975. The demand was confirmed by the Assistant Collector of Central Excise by his order, dated 7-5-1979. An appeal was, thereafter, filed before the Appellate Collector of Central Excise, New Delhi, challenging the order of the Assistant Collector, but the same was also rejected. 2. When the matter came up for hearing before us, Shri P.N. Dixit, Assistant Commercial Officer of M/s Jaipur Udyog Limited appeared for the appellants and Shri S. Krishnamurthy, S.D.R. appeared for the respondent. Shri Dixit stated that in view of the judgment of the Hon ble Supreme Court in the case of Bombay Tyres International Limited reported in 1983 E.L.T. 1896 (S.C.) and the CEGAT Larger Bench decision in the case of Atma S ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... not declaring the handling charges in the price list; (ii) Whether Rule 10 or Rule 10-A is applicable in the present case; and (iii) Whether the demand could be confirmed under Rule 10-A after the rule was deleted from the statute. 5. Regarding first question, we find that there was an agency agreement between the appellants and their sole selling agent M/s Bharat Overseas Private Limited. The relevant paragraphs of the agreement are re-produced below:- (2) That the ex-works and/or F.O.R. destination prices (exclusive of Sales Tax and other local taxes) of cement manufacture by the manufacturer and the terms and conditions on which the cement has to be sold shall from time to time be advised by the Manufacturer to the agent and all cement manufactured by the Manufacturer and covered by this Agreement shall be sold by the Agent on behalf of the Manufacturer at the price and on terms of business as may be communicated by the Manufacturer from time to time. xxxx xxxx (4) That subject to such directions, if any, as the manufacturer may issue from time to time, the agent may appoint sub-agents, stockists and dealers as it may c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s entitled to inspect the stock and relevant records maintained by the agent. The agents were to keep and maintain the books of accounts and records in respect of sale and despatch of cement and were to furnish to the manufacturer such returns, statements of accounts and any other information regarding sale and despatch of cement as might be required by the manufacturer. The appellants had, therefore, full control over the sale of cements by the agent. 7. Under Section 4(4)(a) of the Central Excises and Salt Act, 1944, an assessee includes his agents. In view of the agency agreement read with the above provision of Section 4 of the Act, the appellants were responsible for action of their agents and sub-agents. The appellants were, therefore, liable to declare the handling charges recovered from the customers by their agents and sub-agents. In view of the full control of the appellants on the agents by virtue of agency agreement, it is difficult for us to accept the contention of the appellants that they were not aware of the recovery of handling charges by the agents. In the circumstances, we are to accept the respondents contention that the appellants suppressed the handling ch ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... by the person on whom notice is served under sub-rule (1), shall determine the amount of duty, deficiency in duty or sum due from such person (not being in excess of the amount specified in the notice) and thereupon such person shall pay the amount so determined within ten days from the date on which he is required to pay such amount or within such extended period as the Assist ant Collector of Central Excise may, in any particular case allow." 9. It was held by the Hon ble Supreme Court in the case of M/s Andhra Rerolling Works, Hyderabad v. Union of India and Others decided on 5-5-1986 and reported in 1986 (25) E.L.T. 3 (S.C.) that Rule 10 applies to cases of short-levy through inadvertence, error, collusion or mis-construction on the part of the officer or through mis-statement as to quantity, description or value of the excisable goods on the part of the owner. In short, it pre-supposes the assessment which could be re-opened on specified ground within specified period. On the other hand, rule 10-A, which was a residuary clause, applies to those cases which were not covered by Rule 10 and so invokable without any limitation. Similar view was held by the Supreme Court in the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in support of his contention. We find that the facts in those two cases were different from the present one and as such, those two judgments are not applicable to the present case before us. In the case of R.K. Audim v. Special Steel Ltd. (supra) short-levy was due to misapprehension of the department and as such, it was held by the Supreme Court that the short-levy was covered by Rule 10 and not 10-A. In the present case, short-levy is not due to misapprehension. In the case of N.B. Sanjana v. Elphinstone Spg. Wvg. Mills Co. Ltd. (supra), the short-levy was in the circumstances specified under Rule 10 of the Central Excise Rules and hence, it was held by the Supreme Court that Rule 10-A could not be applied. As already held by us, the short-levy in the present case was due to suppression of facts and this was not covered by Rule 10. Consequently, Rule 10-A was correctly applied. Shri Dixit also relied upon this Tribunal s order reported in 1984 (18) E.L.T. 442. In the case covered by that order, there was no suppression of facts on the part of the appellants and hence, the Tribunal held that Rule 10 was applicable, whereas in the present case there was suppression of facts and a ..... 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