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TMI Blog2000 (5) TMI 355X X X X Extracts X X X X X X X X Extracts X X X X ..... wered to adjudicate". 3. When the matter was called, none appeared for the appellants, M/s. Bihari Silk & Rayon Processing Mills (P) Ltd. We therefore proceed with the matter after hearing the ld. DRs, S/Shri S. Srivastava and R.D. Negi. 4. Ld. DR submitted that the second question that has been mentioned in the referral order has already been decided by other Larger Bench. 5. As regards the first question, namely, whether a Show Cause Notice issued without quantification of duty demand is legal and valid, D.R. refers to and relies on the decision of the Delhi High Court in Hindustan Aluminium Corporation Ltd. v. Supdt., Central Excise [1981 (8) E.L.T. 642] in support of the contention that there was no bar to issuing a SCN without quantification of demand. 6. Ld. D.R. referred to the observations made by the ld. Member (T) in Order No. 661/93-WRB, dated 27-8-93 (para 4.2) in which the ld. Member had stated that since the SCN had given details like the quantity of the fabrics involved, the period during which they were removed and the proposal to recover duty involved thereon, non-quantification of the duty in the SCN could not be construed as a vital omissi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on to show why he should not pay. Mr. Dalal relied on the decision of the Supreme Court in The Kesava Mills Co. Ltd. and another v. Union of India and others, A.I.R. 1973 SC 389. In that case it was held that when a textile mill company and the persons concerned have received a fair treatment and also all reasonable opportunities to make out their own cases before Government they cannot be allowed to make any grievances of the fact that they were not given a formal notice calling upon them to show cause why their undertaking should not be taken over or that they had not been furnished with a copy of the report, more so when Government gave them ample opportunity to reopen and run the mill on their own if they wanted to avoid the take-over. In absence of any resources with them to do so, insistence on a formal hearing in such circumstances is nothing but insistence on an empty formality. It was further observed that it is not possible to lay down any general principle on the question as to whether the report of an investigating body or of an inspector appointed by an administrative authority should be made available to the persons concerned in any given cases before the authority ta ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ioner has been told to show cause why it should not be required to pay the duties for the period between 17 5-1969 to 23-6-1979. The amount is the differential duty between the Central Excise duty leviable under Tariff item 27 and the amount of Central Excise duty rebatable in terms of notification of 17-5-1969 Mr. Sorabjee says that this does not satisfy the requirement of Rule 10 which requires the notice to mention a definite amount. According to the counsel the absence of specification of the amount makes the notice bad and he refers us to (1980 E.L.T. 121) J.B. Printings Inks Ltd v. Union of India & others. In that case a notice issued under Rule 10 called upon the petitioner to pay duty for the period 7-1-1972 onwards. This was held not to be in compliance with Rule 10. We do not think that this authority can be of any assistance to the petitioner. The first reason is that in that case the show cause only called upon the petitioner to pay duty for the period 7-1-1972 onwards. In the present case though the exact amount in terms of Rupees and Paisas is not specified the specification is broadly done by pointing out that the duty payable is differential between the duty leviabl ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ction in favour of the subject is to be applied but if there is no ambiguity and the act or omission falls clearly within the mischief of statute then the construction of penal statute will not differ from that of any other, see Maharaja Book Depot v. State of Gujarat 1979 (1) SCC 295 at 301. The Rule that statutes imposing criminal or other penalties should be construed narrowly in favour of the person proceeded against was more rigorously applied in former times when the number of capital offences was still very large, when it was still punishable with death to cut down a cherry-tree in an orchard or to be seen for a month in the company of gipsies see Interpretation of Statutes by Maxwell page 238 12th Ed. There was obvious sense in giving a strict construction to penal statute and in requiring the fulfilment to the letter of statutory condition precedent to the infliction of punishment and insisting on the strict observance of technical provision concerning criminal procedure and jurisdiction page 240. This rule of interpretation of strict construction was later on extended in England to even statutes while it was said to encroach on the rights of the subject, whether as regard ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tice was recognised by the Supreme Court in Commissioner of Income Tax, Andhra Pradesh v. T. N. Arvinda Reddy [1979 (4) Supreme Court Cases 721] where Krishna lyer, J. speaking for the court said, 'A passing reference to avoidance and evasion of tax was made at the bar, a dubious refinement of a dated legal culture sanctified, though by judicial dicta. The court is not the mint of virtue and one day in our welfare state geared to Social justice, this clear concept of avoidance against 'evasion' may have to be exposed. Enough unto the day is the evil thereof. That administration of tax law must also recognise the demand of social justice, was emphasised by P.N. Bhagwati, J. in AIR 1977 S.C. 1182. 21. In welfare state like ours there is no question of having a tilt in favour of interpretation which will assist in avoiding to pay the taxes and duties which have been levied. Either the provision of law is clear that a citizen is not liable to pay that particular duty or tax, in which case of course he would be entitled to exemption; but the principle of strict interpretation being carried to the extent of holding as if there was something inherently bad or penal in the imposition ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... careful consideration of the decisions referred to above and the settled principles of Administrative Law and principles of natural justice, we are in agreement with the view taken by the Bombay High Court in J.B.A. Printing Inks Ltd. case (supra). We are of the view that even in a case where the omission to specify the amount in the SCN may not cause serious prejudice to the assessee (in view of the other details given in the SCN enabling him to work out the actual quantum of duty liability), the possibility of a dispute arising about the method and manner of arriving at the amount by reason of questions relating to the rate of duty, valuation, classification etc., cannot be ruled out. As had been held in the Bombay High Court judgment, relegating the amount to conjecture or speculation cannot be said to be the intention of Section 11A(1) (or the corresponding provision in the erstwhile Rule 10). In fact, it is only with a view to avoid such situations that Section 11A(1) has clearly provided that the amount should be specified in the notice. Further, in our view, to give an interpretation to Section 11A(1) which would render the expression "the amount specified in the notice" a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... determined' referred to in sub-section (2) of the said Section 11-A; or 'quantification' the expression used in the reference. While there is an element of definitness in specifying any amount, describing or stating in detail is the same as specifying. According to the New International Webster's Comprehensive Dictionary of the English Language (Encyclopedic Edition) 'specify' means, "to mention specifically; state in full and explicit terms." According to The World Book Dictionary 'specify' means "to mention or name definitely; state or describe in detail." According to The New Roget's Thesaurus in Dictionary Form, 'specify' is to particularise, itemize, individualize (detail); mention, cite, enumerate, name (talk, name). 19. The expression 'amount specified in the notice' has a reference to the duty of excise which has not been levied or paid or which has been short levied or short paid or which has been erroneously refuned. The scope of the term 'levy' is wide. In various judicial pronounce-ments, its scope has been explained as under - N.B. Sanjana, Asstt. Collector of Central Excise, Bombay v. Elphinstone Spinning & Weaving Mills Co. Ltd - 1978 (2) E.L.T. (J 399) (S ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed, destroyed or given away. A taxing authority will not ordinarily impose such a duty because it is much more convenient administratively to collect the duty (as in the case of most of the Indian Excise Act) when the commodity leaves the factory for the first time and also because the duty is intended to be an indirect duty which the manufacturer or producer is to pass, on to the ultimate consumer which he could not do if the commodity had for example been destroyed in the factory itself. It is the fact of manufacture which attracts the duty even though it may be collected later" Ashok Singh v. Asstt. Collector of Estate Duty - 1992 ITR 196 at 160 (SC) : "The word 'levy' in Blacks' Law Dictionary (V Edition) at page 816 is stated thus : Levy is to assess; raise; execute, exact; to collect; gather; take up, seize. Thus, to levy (assess, exact, raise or collect) a tax; to levy (raise. or set up) a nuisance; to levy (acknowledge) a fine, to levy (inaugurate) war, to levy an execution i.e. to levy or collect a sum of money on in execution. As a matter of fact in Padampat Singhania - (1980) 122 (ITR) 162 (Allahabad) the meaning of this word (levy) under this very Act [Estate Duty A ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ates a short-levy in the sense that the amount which falls short of the correct amount has been assessed and actually paid. In our opinion the expression "paid", should not be read in a vacuum and it will not be right to construe the said word literally, which means actually paid. That word will have to be understand and interpreted in the context in which it appears in order to discover its appropriate meaning. If this is appreciated and the context is considered it is apparent that there is an ambiguity in the meaning of the word "paid''. It must be remembered that Rule 10 deals with recovery of duties or charges short levied or erroneously refunded. The expression ''paid" has been used to denote the starting point of limitation of three months for the issue of a written demand. The Act and the Rules provide in great detail the stage at which and the time when the excise duty is to be paid by a party. If the literal construction that the amount should have been actually paid is accepted then in case like the present one on hand, when no duty has been levied, the Department will not be able to take any action under Rule 10. Rule 10-A cannot apply when a short levy is made through ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ri Bagaria's attention to another example of the use of the same term. Clause (d) of Section 2, defined "excisable goods" as "goods specified in the First Schedule as being subject to a duty of excise …". The last item in the First Schedule related to other goods, not elsewhere specified ......", which could hardly be called a specific description in the usual sense. This would appear to indicate that the Act contemplated some latitude in the matter of what would constitute a "specific" description. Shri Bagaria agreed that there was a scope for some latitude. However, the latitude could only be with respect to the arithmetical calculation of the amount, provided the information necessary for such calculation was furnished." 21. It is seen that the matter is entirely covered by the Delhi High Court decision in the case of Hindustan Aluminium Corporation Ltd. (HINDALCO) v. Supdt. of Central Excise, Mirzapur, 1981 (8) E.L.T. 642 (Delhi). Under the then existing Rule 10 of the Rules, central excise duty (CED) was demanded for the period 17-5-1969 to 23-6-1979 under show cause notice dated 31-10-1979. The said show cause notice did not specify the amount which M/s. HINDALC ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to seek further particulars, if any, that may be necessary for it to show cause if the same is deficient. The assessee had contended before the High Court that the necessary particulars to enable them to show cause have not been stated in the show cause notice. The High Court held that this cannot be a ground for quashing the notice. 23. It is also seen that this Tribunal has been consistently taking a view that the contention that the show cause notice did not mention the amounts and hence the show cause notice was bad in law, was a untenable contention. In this connection, reference may be made to the following decisions - (1) Tinplate Co. of India Ltd., Jamshedpur v. CCE, Patna, 1983 (14) E.L.T. 1807 (T) (para 7); (2) Chokshi Tube Ltd., Bombay v. CCE, Bombay, 1983 (14) E.L.T. 2362 (T) (para 7); (3) M/s Entremonde Polycoaters Pvt. Ltd., Nasik v. CCE, Pune, 1984 (16) E.L.T. 389 (T) (para 8); and (4) Sundaram Fasteners Ltd. v. CCE, 1993 (64) E.L.T. 87 (T). In the last mentioned decision of Sundaram Fasteners Ltd., supra, the Tribunal had referred to the Supreme Court decisions in the case of (i) M/s. N.B. Sanjana, Asstt. Collector of Central Excise, Bombay v. The Elphins ..... X X X X Extracts X X X X X X X X Extracts X X X X
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