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TMI Blog1999 (6) TMI 406X X X X Extracts X X X X X X X X Extracts X X X X ..... ct read with Notification No. 34/97-C.E. (N.T.), dated 9-10-1996 . 2. Being aggrieved by this order, the appellants have filed these three appeals. The facts of the case briefly stated are that the appellants have stockyards at different places. These stockyards are registered with the Central Excise Authorities and receive iron steel products namely billets, rails, slabs, sheets, plates, pig iron, rounds, bars, angles, channels etc. from Steel Plants of SAIL. The officers of Central Excise visited the stockyard at Jalandhar and recorded the statement of Shri Anil Dhawan who stated that the items stated above are received at their stockyard by rail and by road under cover of Consignment Advices; that sometimes these goods are received from other stockyards under cover of transfer challans; that in cases where any shortages are noticed or suspected, the railways are approached for open delivery and a certificate to that effect is obtained from them; that the weight of the goods mentioned in the Consignment Advices is taken as the quantity received but deliveries are recorded based on actual weighment for which invoice-cum-delivery challans are issued; that the excess/shortage is ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 173Q(1)(bbb). In reply to the SCN, the appellants submitted that Jalandhar SAIL Stockyard handles approximately 1.5 lakh tonnes of Iron Steel Products; that accounting is a continuous process; that excesses/shortages are reported to the manufacturing plants through the statements that the figures recorded in the statements have not been considered in their entirety; that the Department has picked up the figure of excesses for computing the demand of duty but totally ignored the quantity found short; that the Govt. of India after realising the difficulty of the steel plants, allowed them the facility of issuing duty paying documents from the stockyards; that this facility continued upto 1-3-1994 and after that the facility of issue of invoice was provided. On the question of mis-declaration, it was clarified by the appellant that upto 31-3-1994, the stockyard had the facility of issuing duty paying documents that periodical checking of the accounts were never done by the Excise Department; that upto 31-3-1994 all regulatory exercises were confined to production and removal from the plant only. It was submitted that since the demand has been raised on the basis of their own stateme ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d upon the decisions of this Tribunal in the case of Lakshmi Packaging (P) Ltd. v. CCE, Coimbatore reported in 1998 (98) E.L.T. 91 and also in the case of Brindavan Agro Industries Ltd. v. CCE, Kanpur reported in 1998 (98) E.L.T. 284. It was also submitted that penalty was not imposable when no suppression, no wilful mis-statement nor any intention to evade payment of duty is proved. 5. The main thrust of the argument of the Counsel was on the demand being raised under Section 11D of the Central Excise Act, 1944. Ld. Counsel submitted that Hon ble Madras High Court in the case of Eternit Everest Ltd. v. U.O.I. reported in 1997 (89) E.L.T. 28 (Mad.) held that - 22. Even that apart, the conferment of residuary powers upon Parliament with the exclusive authority to make any law with respect to any matter in the concurrent list or Union list inclusive of the power of making any law imposing a tax not mentioned in either of those lists as also the powers under Entry 97 of List I was not the subject matter of consideration in those decisions which dealt with indisputably a challenge to State Legislations. It is not the stand of the petitioners that a provision of the nature envisage ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ollected from the buyer to be deposited with the Central Government. (1) Notwithstanding anything to the contrary contained in any order or direction of the Appellate Tribunal or any Court or is any other provision of this Act or the rules made thereunder, every person who has collected any amount from the buyer of any goods in any manner as representing duty of excise, shall forthwith pay the amount as collected to the credit of the Central Government. (2) The amount paid to the credit of the Central Government under sub-section (1) shall be adjusted against the duty of excise payable by the person on finalisation of assessment and where any surplus is left after such adjustment, the amount of such surplus shall either be credited to the Fund or, as the case may be, refunded to the person who has borne the incidence of such amount, in accordance with the provisions of Section 11B and the relevant date for making an application under that section in such cases shall be the date of the public notice to be issued by the Assistant Collector of Central Excise. A perusal and analysis of Section 11D would go to show that an obligation or liability is caused, no doubt, upon every per ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... does any rule as such appear to have been made also to give effect to the purposes of the Act by providing any such machinery. Though when Section 11B was introduced by Act 25/1978 with effect from 17-11-1980 by a subsequent Central Act 40/91 with effect form 20-9-1991, a provision was enacted in Section 37 enabling the Central Government to prescribe the form in which the application for refund under Section 11B could be made in addition to stipulating the manner in which such claims have to be considered and disposed of having been specifically provided in Section 11B itself, the provisions contained in sub-section (2) of Section 11D also have relevance to cases of claims of refund only and do not deal with a situation like the one before us, wherein a dispute in respect of a basic jurisdictional issue is seriously raised. The submission of the learned Senior Counsel on behalf of the petitioners assumes great significance and importance in this context particularly having regard to the fact that Sections 11A, 11B and 11C deal with only recovery, refund, etc. of duties and not any sum collected representing it to be the duty but not really duty. Section 11A of the Act is attract ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... und of any such duty. On the other hand, having regard to the fact that Section 11D deals with a case where there was no liability to duty as such under the Act, but yet a person or a manufacturer has chosen to collect any amount from the buyer of goods as representing duty of excise but not really in law and excise duty, there is no scope or justification to deal with a case arising under Section 11D invoking the machinery under Section 11A in the absence of any independent provision as such either under Section 11A of the Act enabling application of such machinery to cases under Section 11D or otherwise permitting the attraction or applicability of such procedure under Section 11A by deeming a sum due under Section 11D as the duty liable under the Act or any other provisions of the Act providing for entertaining a claim or determining or adjudication of such a claim or a dispute in this regard in respect of the factum of actual collection of any amount as representing the duty of excise though no such duty under the Act is leviable or exigible under the provisions of the Act. No doubt, the power to legislate with respect to a tax comprehends the power to impose the tax, to prescr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r direction makes that end unattainable. Now, there are three stages in the imposition of a tax: there is the declaration of liability, that is the part of the Statute which determines what persons in respect of what property are liable. Next, there is the assessment. Liability does not depend upon assessment. That ex-hypothesi has already been fixed. But, assessment particularises the exact sum which a person liable has to pay. Lastly, comes the methods of recovery, if the person taxed does not voluntarily pay. This classic statement of law has often been quoted with approval by the Apex Court as well as this Court in number of cases. 24. We have endeavoured to consider the stand taken for the Union of India by the learned Senior Counsel appearing for the respondents with all and required care and caution, but yet, we are unable to accept the stand for the respondents for the obvious reason that the case before us is not one of dealing with a defective provision in a taxing statute dealing with the machinery for assessment and the need for construction thereof as ordained, in a manner, preferably to carry out the clear intention of the legislation and to make a charge levied ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eing vindicated and enforced but only in accordance with law but we grant such liberty to so determine and adjudicate the liability of the petitioners in accordance with law relating to the machinery provisions that may be enacted. It is also well settled that the absence of a machinery provision does not per se is destructive of the liability otherwise created as a charge which would always subsist till the same is properly quantified, notified and enforced in accordance with law or till such time as the claim becomes time barred or unenforceable due to operation of law. He submitted that this decision of the Hon ble Madras High Court was followed by this Tribunal in the case of Sundram Abex Ltd. v. CCE reported in 1996 (88) E.L.T. 734 (T) = 1996 (17) RLT 109. The Tribunal observed. The Hon ble High Court has held that in-as-much as there was no machinery provisions provided for adjudication of the matters under Section 11D, proceedings, therefore, cannot be decided by the authority . The ld. Counsel submitted that this decision of the Hon ble Madras High Court was further followed by the Tribunal in the case of Amal Rasayan Ltd. v. CCE reported in 1999 (108) E.L.T. 531 (T ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . Ld. DR adduced a number of other arguments also in support of the contention that Section 11A provides the machinery for purpose of enforcing the provisions of Section 11D. 8. We have heard the rival submissions. We have also perused the case law cited by both the sides. We find that the Hon ble Madras High Court in the case of Eternit Everest Ltd. had examined the issue in detail and had held that in-as-much as there was no machinery provisions provided for adjudicating the orders under Section 11D proceedings, therefore, cannot be decided by the authority. It was also brought to our notice that there was earlier decision of the same Hon ble High Court in the case of Gem Cables Conductors Ltd. holding that Section 11A provides the machinery. We have perused this decision of the Hon ble Madras High Court, we note that this decision is in regard to limitation. We also note that even if there was a decision of the Hon ble Madras High Court holding that the machinery was provided under Section 11A, we find that this decision was brought to the notice of the Hon'ble Madras High Court in the case of Eternit Everest Ltd. and therefore, the presumption is that it was considered. Sin ..... X X X X Extracts X X X X X X X X Extracts X X X X
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