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TMI Blog1992 (12) TMI 152X X X X Extracts X X X X X X X X Extracts X X X X ..... ppearing in proviso to Sec. 11A(1) of the CESA 44 are ingredients for invoking extended period of five years in place of six months or they are ingredients for deciding jurisdiction to Collector, Central Excise for issue of Show cause notice or both. 2. The matter was argued on behalf of the Collector by Shri A. Choudhuri, learned Departmental Representative and by Shri R.N. Das, learned Senior Advocate, assisted by Mrs. A. Quereshi, Advocate, on behalf of the respondents M/s. I.T.C. Limited, Basudeopur, Munger, Bihar. 3. In terms of the order in question, this Bench took note of the fact that the show cause notice for recovery of duty had been issued by the Superintendent of Central Excise, alleging wilful misstatement with intent to evade duty, and held that since proviso to Section 11A(1) of the Central Excises and Salt Act, 1944 requires that such a notice should be issued by the Collector of Central Excise, the notice was incompetent and without jurisdiction. The Order-in-Appeal confirming the demand challenged in Appeal was, therefore, struck down. In the Reference Application it has been submitted that as the notice had been issued within a period of six months from the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... by the Collector and pointed out that the Reference had been proposed on the basis of the Karnataka High Court judgment in Raletronics Ltd. v. Assistant Collector of Central Excise. That judgment had been delivered by the Honourable High Court disagreeing with the Tribunal decision in Partap Rajasthan Copper-Foils . Laminates Ltd. reported in 1989 (44) E.L.T. 775. But the decision of the larger .Bench of the Tribunal in Alcobex Metals (P) Ltd. v. Collector of Central Excise, reported in 1992 (58),.E.L.T. 108 was not brought to the notice of the High Court. In the said case the Tribunal took note of the statement of objects and reasons for the amendment to Section 11A. The said amendment, it was pointed out, inter alia, proposed that show cause notice in regard to duty of excise short levied etc. by reason of fraud/collusion or wilful misstatement of facts should be issued and such cases decided by the Collector. The Tribunal also took note of the instructions dated 21-7-1987 of the Central Board of Excise and Customs issued on the basis of the advice of the Law Ministry. The said instructions, inter alia, mentioned that if fraud etc. is the ground for issue of the notice, the com ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rroneously refunded by reason of fraud, collusion or any wilful mis-statement or suppression of facts, or contravention of any of the provisions of this Act or of the rules made thereunder; with intent to evade payment of duty, by such person or his agent, the provisions of this sub-section shall have effect. [as if, for the words Central Excise Officer , the words Collector of Central Excise and] for the words six months , the words five years were substituted. The proviso covers situations where the short levy non-levy of duty is by reason of fraud, collusion ; wilful misstatement etc. Thus, two situations are involved - (1) Where the short levy etc. is due to reasons other than fraud, collusion, wilful misstatement, suppression or contravention of the provisions with intent to evade duty; (2) Where the short levy etc. is due to the reasons pointed out. These two situations are covered by Section 11A(1) and proviso thereto respectively. This is brought out below by rewriting that provision giving effect to the proviso: Situation (1): SECTION 11A. Recovery of duties not levied or not paid or short-levied or short-paid or erroneously refunded. - (1) When any d ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... period within six months also. The time limit under the proviso is not split into two separate periods, namely, within six months and beyond six months but within five years. There is, as stated above, only one time limit, namely, five years. The effect of the other substitution of Collector for Central Excise Officer would come into play once the short levy is due to the specified reasons. This will apply irrespective of the time limit for issue of the notice. However, as the High Court decision is to the contrary and as there is no judgment of any other High Court or of the Supreme Court, the question becomes one of law for pronouncement of the correct legal position from the High Court of Patna. With that end in view, we shall examine the proposed reference submitted by the Collector. 8. The first question is the actual issue involved. This is approved for making a reference to the High Court and the question is retrained at the end of this order. The second question proposed by the Collector for reference is whether the reasons like fraud etc. appearing in proviso to the Section 11A(1) are ingredients for invoking extended period of five years in place of six months or they ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... within the six months time limit. In this view of the matter, the question posed is amenable to an obvious answer and does not constitute a question of law for reference to the High Court for advice. We, therefore, reject the application, as far as this point is concerned. 9. For the above-mentioned reasons, the following question of law has arisen for reference to the Honourable High Court of Patna for their valued opinion. 10. The Cross Objection filed by the respondents gets covered by this reference being made to the Court. 11. [Order]. - In view of our above observations, the Reference Application is partly allowed. We, therefore, refer the following question of law to Hon ble Patna High Court for their valued opinion :- Whether a Superintendent of Central Excise is competent to issue a show cause notice for demand of duty within a period of six months from the relevant date, even if, the non-levy or short-levy necessitating such notice is by reason of fraud, collusion or any wilful misstatement of facts or contravention of the provisions with intent to evade payment of duty or only the Collector of Central Excise can issue the notice in such cases, even if the same ..... X X X X Extracts X X X X X X X X Extracts X X X X
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