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TMI Blog1991 (5) TMI 167X X X X Extracts X X X X X X X X Extracts X X X X ..... recting the appellants to pursue the appellate remedies available under the Act. It appears that the said proceedings are still pending. Meanwhile, the department issued two letters dated 20th February, 1986 and 25th February, 1986 stating that the product in dispute is to be classified from 28th February, 1986 under Heading 21.07 and would be liable to pay duty under sub-heading 2107.91. The appellants challenged the above two letters by way of a Writ Petition in the High Court of Gujarat in Special Civil Application No. 1205/1986. The Gujarat High Court during the pendency of the proceedings, passed the following order on 28th February, 1986: Whereas the above named petitioner has present to this High Court of Gujarat at Ahmedabad, petition praying to restrain the respondents permanently as well as pending the hearing and final disposal of this petition from proceeding in any manner against the petitioners on the basis of their products Rasna Soft Drink Concentrate is excisable goods within the meaning of Heading No. 21.07, sub-heading No. 2107.91 or any other heading or sub-heading contained in the Schedule to the Central Excise Tariff Act, 1985 or to require the petitioners ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... date of service of the order to the Petitioners as aforesaid. 4. Thereafter, the Assistant Collector issued a show cause notice dated 17th June, 1987 requiring the appellants to show cause why RSDC should not be classified under Heading 21.07 as edible preparations not elsewhere specified and chargeable to duty at 15% ad valorem under sub-heading No. 2107.91 with effect from 28th February, 1986 and proposing to recover the short-levy/non-levy of duty of Rs. 2,63,031.01 for the period from March, 1986 to April, 1987. 5. The appellants filed a reply raising inter alia objections to the jurisdiction of the Assistant Collector to issue the show cause notice. They have also contended that the show cause notice is barred by limitation. On a consideration of the reply, the Assistant Collector classified the product as proposed in the show cause notice and confirmed the demands. On appeal, the Collector remanded the matter to the Assistant Collector for de novo consideration having held that the Assistant Collector has jurisdiction to issue the show cause notice, against which the present appeal is filed. 6. Shri Jain appearing for the appellants mainly raised two contentions : (i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed 28th February, 1986 has resulted in the stay of service of notice by the Department, the Assistant Collector is competent not only to issue the show cause notice but the question of limitation also does not arise. 9(a). At this stage, we may point out that the appellants filed the Writ Petition No. 1205/86 in the High Court and the High Court passed the interim order on 28th Feb., 1986. The High Court disposed of the Writ Petition on 20th April, 1987. The show cause notice was issued on 17th June, 1987. Under Section 11A of the Act, a Central Excise Officer is competent to serve notice on the person chargeable with duty which has not been levied within six months from the relevant date. The expression relevant date has been defined under sub-section (3) of Section 11A in the following manner : Relevant date means :- (a) In the case of excisable goods on which duty of excise has not been levied or paid or has been short-levied or short-paid - (A) whereunder the rules made under this Act a monthly return showing particulars of the duty paid on excisable goods removed during the month to which the said return relates, is to be filed by a manufacturer or producer ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... il Application, according to which, the status quo as on date will be maintained till further orders . The question, therefore, is what is the meaning of status quo . Prior to the filing of the special civil application, there was a dispute as to the classification of the product. The appellants were claiming the classification under Tariff Item 1B and the benefit of exemption Notification No. 17/70 dated 1-5-1970, whereas the Department was claiming the classification under Tariff Item 68 and the dispute is pending before the Departmental Authorities. By letters dated 20th Feb., 1986 and 25th Feb., 1986, the Department wrote to the appellants saying that Rasna manufactured in your above factory at Kalol will now be liable to be classified under the Heading No. 21.07, edible preparations not elsewhere specified are included. It will attract Central Excise duty at the rate of 12% under sub-heading No. 2107.91 with effect from 28th Feb., 1986. Therefore, you are hereby advised and requested to follow the Central Excise Procedures and observe the formalities laid down under the Central Excise Rules, 1944 in respect of the above excisable goods manufactured in your factory. The e ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... pursuance of the judgment of the High Court, the appellants stopped paying duty from 6-11-1980 on yarn consumed captively. Meanwhile, the Department issued show cause notice dated 4-5-1981 under Section 11A of the Act demanding duty from 6-11-1980 to 31-3-1981. The appellants challenged the validity of these notices before the Delhi High Court. The Delhi High Court granted stay in terms of prayer which reads as follows: grant of stay permitting the petitioners forthwith to further process yarn, in its composite mill in the manufacture of fabrics at nil rate of duty and to dear cotton fabrics only (without payment of duty on cotton yarn) and to restrain the respondents 4 to 6 from taking any action or proceedings pursuant to and/or on the same basis as the contents of the directive of the Board, respondent No. 2, and to stay further proceedings pursuant to notices dated 4-5-1981 and addenda dated 5-5-1981. During the pendency of Writ Petition, the Central Govt. amended Rules 9 49 of the Central Excise Rules with retrospective effect providing inter alia for levy of excise duty on goods captively consumed. The appellants challenged the amendment by amending the Writ Petition ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... is stayed by an order of the Court, the period of such stay shall be excluded in computing the aforesaid period of six months or five years, as the case may be. In this context, we may refer to Section 15 of the Limitation Act which is in pari -materia with the present provision, which is as follows: Section 15 : Exclusion of time in certain causes. (i) in computing the period of limitation for any suit or application for the execution of a decree, the institution or execution of which has been stayed by injunction or order, the time of the continuance of the injunction or order, the date on which it was issued or made, and the date on which it was withdrawn, shall be excluded." The other provisions are not relevant. Construing the above provisions, the Allahabad High Court in Hula Singh Ors. v. Data Ram Ors. [1943 AIR 291 Allah.] held that the period between and conclusion of proceedings must be excluded. It is necessary to refer to the facts in brief. The mortgage was executed by the defendant in favour of the plaintiff on 10-7-1925 and under the law of limitation, the time of instituting a suit on the basis of the mortgage would have expired on 10-7-1937. Ho ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... dent. On 7-6-1917 execution was taken out. On 17-6-1917 Sale Proclamation was issued and 17-9-1917 was the date fixed for sale. On 3-9-1917, a third party instituted a suit claiming title to one-half of the house and injunction restraining the respondent from selling it. On 12-9-1917, injunction was granted. On 19-11-1917, the other half of the house was sold and the sale was confirmed on 22-12-1917. On 8-11-1918, the suit of the third party was dismissed for default and injunction was, thus, disallowed. The application for execution in respect of the other half was made on 10-1-1922. The Court held that the said application was barred by limitation as it was filed beyond the period of three years from the date on which the last application for step-in-aid of execution was filed. The last application of the Court to take some step-in-aid of execution was filed on 19-11-1917, three years from that expired on 19-11-1920. The injunction was in force for 11 months and 20 days viz; from 19-11-1917 to 8-11-1918. By adding this period of 11 months and 20 days, the respondent was entitled to apply for execution uptill 8-11-1921. Since the execution application was filed on 10-1-1922, the ..... X X X X Extracts X X X X X X X X Extracts X X X X
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