9911796707
TMI Blog1998 (3) TMI 211X X X X Extracts X X X X X X X X Extracts X X X X ..... air-conditioners and appellant assembles air-conditioners in the same premises. By Notification No. 64/83-C.E., there was exemption available for clearances of air-conditioners up to the aggregate value of Rs. 2.5 lacs in a financial year provided the value of clearances in the preceding year did not exceed Rs. 2.5 lacs. The dispute in this appeal relates to 1986-87. Appellant had not paid Central Excise duty on the clearances during the year. On 30-9-1986, Central Excise officers visited the premises, seized some records and recorded statements of the appellant and his father. Even, according to the Department, as on that date, the value of clearances during the period was well below Rs. 2.5 lacs. If subsequent clearances during the year a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in 1986-87, relevant dates, assembling charges received, tonnage, value of parts, total value and the progressive value. Twenty seven air-conditioners are shown to have been sold to 12 different parties. The progressive total value arrived at is Rs. 2,73,150/-. According to the appellant, Serial Numbers 2 and 6 should not have been included in the list and if they are excluded, the total value of clearances would be below Rs. 2.5 lacs. Serial Number 2 did not relate to Air-conditioner assembled and manufactured by the appellant. Serial No. 2 related to sale of second-hand air-conditioner to M/s. Girnar Cement Ltd. and this air-conditioner had been purchased by the appellant as part of his trading activity. Serial No. 6 also related to char ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nd handed over to the appellant for assembling and the cost of these air-conditioners at that time was Rs. 9,000/- per unit inclusive of assembling charges and the cost of parts. He also stated that even at that time both the units were in operational condition and one of them bears the nameplate of the appellant. He undertook to produce the Bills for the air-conditioners. It is contended for the appellant that this witness committed a mistake inasmuch as two air-conditioners covered by the Bills were assembled and sold to him only in December, 1988 and January, 1989 and not in April, 1986 as stated by the witness. The statement at page 51 of the Paper Book shows the dates as 5-6-1986 and 12-6-1986. The partner of the buyer was cross-examin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ified in coming to the conclusion that these two air-conditioners were assembled and cleared in June, 1986. The above discussion will show that the value of air-conditioners in Serial Nos. 2 and 6 was rightly included in the total value of clearances for the year and the value exceeded Rs. 2.5 lacs. 7. Notification 64/83 makes it clear that the eligibility depended on the value of clearances of the preceding year not exceeding Rs. 2.5 lacs. The Department has no case that the value of clearances exceeded the limit in the preceding year. The circumstance that the value of clearances for the current year exceeded Rs. 2.5 lacs cannot deprive the appellant of the benefit of notification. The only consequence would be that the appellant should ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... o the conclusion that the value of clearances for the year could exceed Rs. 2.5 lacs. Offices were more concerned with the activities conducted in the name of the father and his son in the same premises. In the course of such investigation, statements of some of the buyers were recorded in various months of 1989. Material to show the higher value of clearances became available only in 1989 and subsequently. In these circumstances, we are unable to agree that there was culpable inaction on the part of the officers in not initiating action by issuing a show cause notice for a long period. The facts and circumstances clearly justify invocation of the proviso to Section 11A(1) of the Act. 9. Confirmation of the entire demand is erroneous sinc ..... X X X X Extracts X X X X X X X X Extracts X X X X
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