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TMI Blog1987 (7) TMI 220X X X X Extracts X X X X X X X X Extracts X X X X ..... or about assessment of the foil scrap as scrap and for this purpose they wrote one or two letters to him seeking instructions on the assessment of the scrap. Eventually in June, 1976, a meeting was held at which it was decided that the aluminium foil scrap was to be charged to duty as foil under Heading 27(c) and not under Heading 27(a)(i). 2. Not satisfied with this, the Bombay Central Excise issued a trade notice dated 7th February, 1978 announcing that aluminium arising in the manufacture of aluminium foil was assessable under Tariff Heading 27(a)(i); that is, it was back to crude aluminium, the heading favoured in November, 1967. With this, started these proceedings with a Notice dated 1-4-1978 to Indian Aluminium from the Superintendent of Central Excise telling them that orders had been received that aluminium scrap arising out of the manufacture of aluminium foil was assessable as aluminium in crude form under Heading 27(a)(i). He told them that the differential duty should be paid within eight days for all the period where duty had not been paid at 40%. This notice was followed by another dated 18th July, 1978, from the Superintendent, telling Indian Aluminium to show ca ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... de to foil, that they would not be responsible for any loss of duty following from this change. But sure enough, what they had feared came to pass, and in a few years, they were again told that the correct assessment of their aluminium foil scrap was as crude aluminium and that they would have to pay all the duty for the past period. The Superintendent did issue a revised demand which scaled down the original rupees eleven lakh demand to a rupees two lakh demand, but it is still bad enough, said the counsel. They are not liable to pay even one nP. He repeated that the past assessment as foil was under the Central Excise directions and, therefore, the Central Excise cannot arbitrarily change the assessment to demand duty for the past. They can, if they wish, assess their goods under another head even if it meant a higher rate of duty; and when notice is given to them of such new assessment, they will be placed in a position to price their goods accordingly so that they do not have to bear the duty themselves. But when demand notices like this one are issued for goods which they have sold at the lower rate of duty, they would only have to bear the extra duty themselves, since they wi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he immediate past was not because of any approval of classification list of any such processes, but because the Central Excise Collectorate directed the appellants in November, 1975 to submit a classification list for assessment of foil scrap under Tariff Heading 27(c), which till then was being assessed under Heading 27(a)(i), also under Central Excise orders. The notice of 18th July, 1978 was the result of the public notice of 7.2.1978 and it cannot, therefore, be said that the demand notice of the Superintendent was the discovery of short levy. There was only a change of opinion and indeed a reading of the trade notice confirms this. 8. The trade notice said that the classification of aluminium scarp arising in the process of manufacture of aluminium foils when cleared as such was under consideration. In the second paragraph the notice says it had been decided that aluminium scrap arising out of the manufacture of aluminium foil was assessable as aluminium in crude form. Please note carefully that this decision was not the result of confirmation of an opinion upon discovery of new hitherto unknown facts of technological knowledge. The facts remained the same and the goods rem ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... emanded by the Superintendent in his Notice dated 18th July, 1978. 13. It is not possible to cast the notice of 1st April, 1978 in any role in this play. It is not a demand notice, because it states neither amount demanded nor period, nor does it ask the notice receiver to show cause as notices of this nature must do. This omission itself invalidates this notice to a notice of no effect, only to be ignored and discarded. 14. The learned counsel for the department made a good point when he read Paragraph 19 of the Entremonde Polycoaters decision of this Tribunal. The difference between this case and that one, however, is that in the Entremonde Polycoaters case, a classification list which had been approved had been found to be incorrect, as an exemption had been allowed which the Assistant Collector came to the conclusion was not in order. For this purpose, he issued a demand under Rule 10 and also asked the manufacturers to show cause why the exemption should not be withdrawn. In so doing, he followed all the prescriptions of the law and sought to recover duty which had been short levied by reason of the past assessment. 15. There was none of the quick-changes we see in ou ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... will reproduce below the last two paragraphs of his order :- Regarding show cause cum demand for Rs. 11,65,497.03 the issues to be decided by me are as to whether the clarification made by the Collector in the Trade Notice is question can be given retrospective effect in the circumstances of the facts of the case and whether the above show cause cum demand is within the provisions of the Rule 10 of C. Ex. Rules 1944. It is a fact to be knowledged that every manufacturer licensed under C. Ex. Act and Rules expects that there should be uniformity in assessment of goods manufactured by him and similar ones manufactured by others. It is with this intention that the matters are examined at the higher level and clarifications by way of trade notices are issued from time to time. While giving effect to such Trade notifications one has to adhere to the provisions made in this connection in the C. Ex. Act and Rules 1944. For this purpose the provision has been made in Rule 10 (then in existence) Central Excise Rules, 1944. In the instant case the provisions of Rule 10(1) are correctly applicable irrespective of finalisation of RT 12 returns since the duty has not been paid under protest. ..... X X X X Extracts X X X X X X X X Extracts X X X X
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