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TMI Blog1991 (2) TMI 255X X X X Extracts X X X X X X X X Extracts X X X X ..... ed before the original authority or in first appeal nor even in hearing before the Tribunal. 2. The points arise from the Tribunal s order No. 141/Cal/1990-141 dated 30-3-1990 on the appeal filed by the Collector as against the Order-in-Appeal No. 306/Pat/88 dated 31-10-1988. It was held by this Tribunal in the said order while accepting his plea in the appeal that P. B. Wire Mesh and Industrial Cloth are not eligible for the benefit of Modvat credit under Rule 57A of the Central Excise Rules, 1944 that while working out the demand for the amount of credit, the Assistant Collector should work out the amount of demand arising from wrong availment of credit to a period of six months from the serving of the demand, as per the provisions of Section 11A of the Central Excises and Salt Act, 1944. 3. The matter was argued on behalf of the applicant by Shri M. N. Biswas, learned Senior Departmental Representative. He referred to the points raised in the application that recovery of credit wrongly availed is separately and specifically provided for under Rule 57-I which was distinct from Section 11A which related to recovery of duty short-levied or short-paid. At the material time there ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the applicability of Section 11A or its predecessor provision viz. Rule 10 of the Rules to regularise wrong availment of credit under Rule 56A or Notification 201/79 or Rule 57A, the subsequent decision of the Gujarat High Court is Torrent Laboratories case, relied by Shri Biswas in the hearing needs to be carefully considered. In their judgment the Hon ble Gujarat High Court had held that the limitation under Section 11A of the Central Excises and Salt Act cannot be read into unamended Rule 57-I because Rule 57-I was enacted under - (1) Section 37 and not under Section 11A and Legislature being aware of the existence of Section 11A cannot be supposed to have indulged in a futile exercise by intending Section 11A to be read into Rule 57-I; (2) Rule 57-I is not a general provision for recovery but is a specific provision for recovery of credit taken wrongly and thus has a different purpose from Section 11A; (3) When a general provision (Section 11A) exists and the Legislature enacts a special provision Rule 57-I, it must be presumed that the general provision does not apply to the special provision. 6. ......... under Rule 57-I relating to Modvat credit wrongly take ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... reference to Rule 12 of the Medicinal Toilet Preparation (Excise Duty) Rules, 1956 which was pari materia with the unamended Rule 57-I. Thus, while a reasonable period of limitation was felt to be necessary in the absence of any provision for limitation in the whole of the Medicinal Toilet Preparation (Excise Duty) Rules, 1956, the Rule 57-I does not stand in isolation. The Central Excise Rules have been framed under Section 37 of the Central Excises and Salt Act to carry into effect the purposes of the said Act. Hence the provisions of Section 11A stipulating time-limit for recovery of duty short-levied cannot be ignored while proceeding under the unamended Rule 57-I. As observed by the Bombay High Court, where credit of duty has been erroneously given, the finished product is under assessed to duty and that is short-levy. Rule 10 was held to be applicable and not Rule 10A. In the present context, Section 11A would be the corresponding provision. It is incidentally to be noted that the Gujarat High Court itself had observed that the legislative intention in amending Rule 57-I was simply to make more explicit and precise that which was already implicit in the Rule. The limitation ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he provision of Section 11A. In the circumstances, it is difficult to hold that Section 51 overrides the provision of Section 11A. * * * * * 33. There is no provision in the Act or in the Rules enabling the Excise authorities to make any demand beyond the periods mentioned in Section 11A of the Act on the ground of the accrual of cause of action. The question that is really involved is whether in view of Section 51 of the Finance Act, 1982, Section 11A should be ignored or not. In our view Section 51 does not, in any manner, affect the provision of Section 11A of the Act. In the absence of any specific provision overriding Section 11A, it will be consistent with rules of harmonious construction to hold that Section 51 of the Finance Act, 1982 in so far as it gives retrospective effect to the amendments made to Rules 9 and 49 of the Rules, is subject to the provision of Section 11A." For the following reasons we are of the view that Section 11A, along with its time-limit criteria would apply where credit has been wrongly taken and utilised. Rule 57-I would apply, independent of Section 11A, only where the credit has been only taken but not utilised. W ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... (referred to supra) was upheld by the Supreme Court in the decision reported in 1988 (38) E.L.T. 573 (SC) on the Civil Appeal Nos. 1571-72 of 1988 filed by the Collector of Central Excise, Baroda (decided on 26-10-1988). The learned Advocate also contended that in all such cases the Tribunal is obliged to refer the question of law which calls for investigation, examination, debate or where a dubious problem of point of law decided by the Tribunal is involved. The Tribunal is not obliged to refer every point of law. In this connection, he relied on a decision reported in I.T.R. 1983 Vol. 140 Page-418 in the case of Commissioner of Income-tax, Shillong v. Basanta Kumar Agarwalla and Another, decided by the Hon ble Gauhati High Court. He also contended that merely because Rule 57-I does not prescribe any time-limit some reasonable time should be applied and time of limitation prescribed under Section 11A is considered to be reasonable by the Tribunal and in such circumstances he contended that no question of law has arisen out of the order of this Tribunal which is required to be referred to the Hon ble High Court for decision. 10. We have heard both the sides in detail. In the cas ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tation and in our opinion there is no such point of law which has arisen out of the orders of this Tribunal, which is required to be referred to the Hon ble High Court for their valued opinion in this behalf." I follow the same reasoning in the present case. 11. The second point on which the Collector had applied for a reference to be made to the Hon ble High Court is whether the Tribunal can suo motu, decide the issue of validity and issue of limitation ground which is not the subject matter of the appeal. It is seen that the respondents had, in fact, raised the point of limitation in their appeal before the Collector (Appeals). Since the appeal was decided entirely in their favour by that authority, he had not given a finding on that question. Though the point was canvassed by the respondents in the proceedings before this Bench, the same was not referred to but taken into account only in the order passed. Even otherwise, under Section 35C, the Tribunal may, after hearing the parties, pass such orders as it thinks but confirming, modifying or annulling the decision appealed against. According to Rule 10 of the CEGAT (Procedure) Rules, 1982, relating to the grounds which may b ..... X X X X Extracts X X X X X X X X Extracts X X X X
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