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TMI Blog1984 (5) TMI 239X X X X Extracts X X X X X X X X Extracts X X X X ..... of clearance of Naphthol only during the preceding financial year was also furnished along with the necessary declaration ; (d) the said classification list was approved on 26-5-1978 by the Assistant Collector, Central Excise ; (e) between 1-4-1978 and 19-11-1981, on several occasions the Central Excise authorities had checked and re-checked and verified the records relating to the production and clearance of Rapidogens as well as Naphthol A.S.G.; (f) nevertheless, a notice requiring the Appellant to show cause as to why- (i) Central Excise duty at the appropriate rate amounting to ₹ 1,57,370.85 (Rs. 1,49,877 Basic plus ₹ 7493.85 Special) should not be demanded and recovered under Rule 9(2) of the Rules, read with Section 11A of the Central Excises and Salt Act, 1944 (hereinafter referred to as the Act), and (ii) a penalty should not be imposed under Rules 173Q and/or 9(2) and 52A, was issued on 19-11-1981; (g) it was, inter alia, alleged in the aforesaid notice that - (i) the Appellant had availed of the benefit of the exemption in terms of Notification No. 71/78, dated 1-3-1978, although not entitled, in as much as the aggregate value of speci ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... evant information and the plea relating to proforma credit was merely hypothetical ; (k) the instant appeal was the sequel. 2. Before us, while reiterating the contentions advanced earlier in. support of the Appellant s case, the learned Counsel for the Appellant invited our attention to Explanation (4) in Notification No. 147/79, dated 30-3-1979 and contended that inasmuch as it was declaratory or clarificatory of the intent of the legislature, it should be given a retrospective effect. The learned Departmental Representative generally supported the orders below. 3. The questions that, therefore, arise for our consideration in the instant Appeal are - (a) Whether, in terms of Notification No. 71/78, dated 1-3-1978, goods exempted under any other Notification are to be taken into account or excluded from the reckoning in the computation of the aggregate value of specified goods cleared during the relevant period, (b) Whether Explanation (4) in Notification No. 141/79, dated 30-3-1979 is of a declaratory or clarificatory nature and consequently retrospective in its applicability ? (c) (i)Whether in the facts and circumstances of the case, there was any wilful mis ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ring the financial year preceding should not exceed ₹ 15 lakhs ; (f) once this is so, there could be hardly much of a controversy on the question as to whether the expression excisable goods or specified goods in the aforesaid Notification included goods exempted from levy by virtue of any other Notification, in so far as Dyestuffs are concerned. The value of goods falling within Item 14D in the aggregate should not exceed the specified limits, regardless of exemption in respect of any of them under any other Notification. The legislative intent is clear by contrast with other items specified in the selfsame Notification. We are, therefore, unable to accede to the contention to the effect that - (i) the value of goods falling within Item 14D, but exempted under any other Notification, need not be taken into account in the reckoning of the aggregate value, in terms of Notification No.71/78-C.E., dated 1-3-1978, and (ii) accordingly, the value of Rapidogens cleared during the relevant periods need not have been furnished in the statement appended to the classification list or the declaration annexed thereto. 5. (a) The amending Notification No. 141/79-C.E., ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ne for the present purpose [Rule 9(1)]; (ii) the manufacturer is bound to pay on written demand within the period specified in Section 11A of the Act, the leviable duty, in respect of goods removed from the place of manufacture, in contravention of Rule 9(1); [Rule 9(2)]; (iii) in any case of such contravention, the manufacturer becomes liable to a penalty extending upto ₹ 2,000 and the goods shall be liable to confiscation [Rule 9(2)]; (iv) when the duty had not been levied or has been short levied, or when there has been an erroneous refund, the proper officer may, within 6 months of the relevant date (i.e. when the duty required to be paid in terms of the Rules) serve a notice requiring the manufacturer to show cause as to why he should not pay the amount specified in the notice-Section 11A of the Act); (v) if, however, a short levy was occasioned by reason of fraud, collusion or any wilful mis-statement or suppression of facts or contravention of any of the provisions of the Act or of the Rules with intent to evade payment of duty, the period within which a notice could be issued is 5 years instead of 6 months [proviso to Section 11A of the Act]. (c) Rule ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tement. (h) We, therefore, hold, in the facts and circumstances of the case, that the larger period of limitations in the proviso to Section 11A is attracted and the notice of demand-cum-show cause issued within five years of the relevant date is not barred. 7. Indisputably, the Appellant had been availing of the benefits of proforma credit under Rule 56A of the Rules prior to the Notification No. 71/78, dated 1-3-1978. In the computation and assessment of the leviable duty, in case the said notification was inapplicable, it was the plain duty of the appropriate officer to have extended the benefit of the proforma credit to the Appellant. The extension of the benefit of the proforma credit in terms of Rule 56A enjoyed by the Appellant hitherto cannot be brushed aside as merely hypothetical. 8. While rejecting the Appeal, therefore, we, hereby, direct the lower authorities to compute the leviable duty after affording the Appellant the benefit of proforma credit under Rule 56A of the Rules, if otherwise eligible. Order accordingly. 9. [ Order per : H.R. Syiem, Member (T) ] - The appellants may argue that Explanation V introduced into Notification 71/78 by amending N ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... so except to say that it was under the belief that Rapidogens need not be included as they were exempted under another notification. There was nothing to induce that belief and hence the conclusion that there was suppression was correct. I cannot agree with the Assistant Collector that there was no culpable state. The 5 year limit for the demand was, therefore, correct. It may be true that the demand was issued only after Explanation IV was introduced into Notification 71/78-C.E., but I cannot see why this would make a difference to the charge. The failure of an officer cannot mitigate to charge because by so doing it is to assume implicitly that the officer knew that the figure of clearances should be higher and he still took no notice. We cannot make that assumption on the evidence we have. If the manufacturer had stated the full figures of production and clearances but the authorities nevertheless gave the concession, we might be able to allow that the Central Excise s lapse made an essential difference which invalidates the charge in an essential matter. It was not this kind of case either. 13. The appellant argues that in Madhar Mills v. Collector of Central Excise - 1982 E ..... X X X X Extracts X X X X X X X X Extracts X X X X
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