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TMI Blog1989 (7) TMI 226X X X X Extracts X X X X X X X X Extracts X X X X ..... e Government of India, vide Finance Department Circular No. 297/2/77 CX-9, dated 23-9-1977, decided to allow "in bond" export of excisable goods to Nepal without charging excise duty where the payment was to be received in free foreign exchange. The Government also, vide Notification No. 304/77, dated 24-10-1977 made amendment in Rule 13 of the Central Excise Rules, by incorporating sub-rule (2), enabling the Government to permit such export without charging duty and Trade Notice No. 248 (MP)/Gen/36/77 dated 14-12-1977 was issued laying down the procedure to be followed for availing of such benefit. 3. The appellants, who are the manufacturers of Agricultural Tractors, falling within T.I. No. 34 of the Central Excise Tariff, and are holdin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... at the export to Nepal under "in bond" facility was discontinued after 21-11-1980 as per instructions issued by the Central Board of Revenue, and as the tractors in question were exported after that date the, amount was demanded. The said notice was issued under Rule 13 of the Central Excise Rules, 1944. The appellants submitted reply to the said notice of demand and explained that the export was in pursuance of the Govt. Circular dated 23-9-1977 and the Trade Notice dated 14-12-1977 and that the export was under express permission granted by the competent authority. They also pleaded that it was only under the Trade Notice dated 3-7-1981 that the facility stood withdrawn, whereas the export was prior to the same. They also pleaded that no ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ision of the Andhra Pradesh High Court in Burhanuddin Hussain v. State of Andhra Pradesh, reported in AIR 1970 AP 137, and of the Madhya Pradesh High Court in Madhumilan Syntex Pvt. Ltd. v. Union of India, reported in 1985 (19) E.L.T. 329 (MP). He also submitted that in absence of any notice to show cause, the demand made is bad in law and cannot be sustained, and in support of their claim, cited decision of the Bombay High Court, in Precision Steel Fasteners v. Union of India, reported in 1980 (6) E.L.T. 643 (Bom.). He also relied upon the decision of CEGAT West Regional Bench in M/s. Kiran Spinning Mills v. Collector of Central Excise, reported in 1989 (22) ECR 82, and of CEGAT Special Bench 'B' decision in Hydraulics Ltd. v. Collector of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e notice". Obviously the notice in question does not comply with the requirement of the said Section. 13. The Bombay High Court, in Precision Steel Fasteners v. Union of India, reported in 1980 E.L.T. 693 (Bom.) nad before it a question where the demand covered under Rule 10 (as It existed then) of the Rules was raised without issue of any show cause notice and the Bombay High Court came to the conclusion that the demand was illegal and void. 14. It was, however, submitted that, assuming that the notice dated 15-7-1981 was not a notice under Section 11A of the Act, the defect was cured by permitting the appellants to file representation and giving personal hearing. 15. This point was squarely before the CEGAT Special Bench 'B' in Hydraul ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hat facility of "in bond" export to Nepal is suspended, under the order from the Board, whereas the adjudicating authority has confirmed the demand, on the ground that no notification was issued under Rule 13(2) of the Rules. This may also lead to quashing of the order, on the ground that the conclusion is based on the ground not indicated in the so-called "notice of demand cum show cause notice", if at all the notice dated 15-7-1981, can be so interpreted, what is sought to be emphasised here however is that the notice of demand dated 15-7-1981, is even not taken as the show cause notice by the department, who has adjudicated the issue, on the points not shown in the said notice. 20. When any demand is made without issue of show cause not ..... X X X X Extracts X X X X X X X X Extracts X X X X
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