9911796707
TMI Blog2010 (7) TMI 402X X X X Extracts X X X X X X X X Extracts X X X X ..... 998-99 the respondent Company cleared 1003.75 Metric Tons of Synthetic Rutile concentrate valued approximately at Rs. 2.25 crores to Domestic Tariff Area (DTA) without payment of duty under the Central Excise Act which is now estimated at Rs. 18,07,997/-. The respondent did so because they claimed the benefit of Notification No. 4/97-C.E., dated 1-3-1997. The said notification admittedly grants complete exemption of the duty payable under the provisions of the Central Excise Act read with the Central Excise Tariff Act to ores falling under Chapter 26, Tariff Items 2601 to 2617 of the Central Excise Tariff Act. The said claim of the respondent was initially accepted by the department. 3. However, by a show cause notice dated 8-7-1998 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rmined by the adjudicating authority whereas the demand for the remaining period was held to be illegal. Hence the present appeal. 5.Section 11A of the Central Excise Act provides for recovery of duties either not levied or not paid or short-levied or short-paid or erroneously refunded by the department. Such a recovery is permissible only after following the procedure prescribed under sub-section (1) of Section 11A of the Act if the department issues a notice to the assessee within a period of six months (at the relevant point of time and now one year with effect from 12-5-2000) from the relevant date, varying upon the factor whether it is a case of non levy or short levy or refund, etc. However, the proviso to the said Section grants an ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s "five years" were substituted : Explanation. - Where the service of the notice is stayed by an order of a court, the period of such stay shall be excluded in computing the aforesaid period of one year or five years, as the case may be." 6. It can be seen from the language of the proviso to Section 11A(1) of the Act that the extended period of limitation is available to the department where the non-levy, short-levy, etc. which resulted in a loss to the Revenue is as a consequence of any fraud, collusion or any wilful mis-statement or suppression of facts with intent to evade payment of duty. 7. The case of the appellant is that there was wilful and deliberate mis-statement of facts by the respondent while claiming the benefi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... opinion of the Chemical Analyst the department reached the conclusion that the product of the respondent is a 'concentrate', but not an 'ore'. 10. The learned counsel for the appellant therefore very strenuously argued that the Tribunal erred in allowing the appeal of the respondent herein. The learned counsel placed reliance on the following judgments of the Supreme Court. In Continental Foundation Jt. Venture v. Commr. of C.Ex., Chandigarh-I - 2007 (216) E.L.T. 177 (S.C.) at paragraph 10, the Supreme Court considered the meaning of the expression 'suppression' occurring under the proviso to Section 11A(1) of the Central Excise Act and held as follows : "10. The expression "suppression" has been used in the proviso to Sectio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... emonstration to the Department. The Department did not avail of that opportunity to find out whether there is manufacture in the first instance, conceptually. Secondly, as held in the judgment of this Court in the case of Padmini Products v. Collector of C.Ex., reported in 1989 (43) E.L.T. 195, as well as in the case of Collector of Central Excise v. Chemphar Drugs & Liniments, reported in 1989 (40) E.L.T. 276, extended period of limitation is applicable only when there is some positive act other than mere inaction or failure on the part of the manufacturer. There must be conscious or deliberate withholding of information by the manufacturer to invoke larger period of limitation. In view of the aforesaid two decisions, we see no infirmity i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ful or deliberate suppression of the fact. We are of the opinion that whether the respondent is entitled for the benefit of the exemption notification or not depends on the interpretation of the exemption notification. The notification admittedly seeks to exempt ores from the central excise liability. The product of the respondent is classified, as already noticed, under Chapter 26, item 2614 under the title Titanium ores and concentrates. What constitutes an 'ore' and what constitutes a 'concentrate' is not statutorily described. Even according to the department, it is the opinion of the Chemical Analyst which made them to believe that the product of the respondent is not an 'ore' but a 'concentrate'. If a conclusion is dependent upon the ..... X X X X Extracts X X X X X X X X Extracts X X X X
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