9911796707
TMI Blog1985 (7) TMI 362X X X X Extracts X X X X X X X X Extracts X X X X ..... the period 1978-79 to 1982-83 (upto January, 1983) they were manufacturing the abovementioned goods. In regard to the pharmacopoeial preparations they were availing themselves of the benefit of exemption available to small manufacturers of goods falling under that item. In regard to the patent and proprietary medicines, they were availing themselves of the separate exemption for small manufacturers, under Notification No. 71/78, dated 1-3-1978, which was subsequently replaced by Notification No. 80/80, dated 19-6-1980. 2. Following a visit of the preventive staff to the factory of the appellants, a show cause notice was issued to them on 12-8-1983 for wrongfully availing themselves of the exemption under Notifications No. 71/78 and No. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... dvocate, Shri Christian argued in great detail that they had throughout acted in good faith and disclosed all material facts to the excise authorities. During the relevant period both the manufacturers and the Central Excise officers in Surat Division were of the view that goods exempted from payment of the whole of the duty of excise leviable thereon were non-excisable goods. It had subsequently been clarified that this view was not correct, and they were not seeking to Advocate this view. It was, however, their case that their failure to comply with relevant Central Excise formalities, and pay duty was solely due to this general misapprehension about the legal position. In the present case, the show cause notice had been issued on 12-8-19 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t classification lists, since this was not required in respect of manufacturers whose production was less than 80% of the exemption limit. 7. Shri Christian emphasized the point that in the second classification list it was specifically indicated that exemption on the Item 14E goods was being claimed in terms of Notification No. 71/78 as amended. 8. Shri Christian also drew our attention to a number of letters dated 15-1-1979, 5-1-1980, 1-9-1980, etc. addressed to the appellants by the Superintendent of Central Excise. These are evidently in reply to letters addressed by the appellants enclosing labels of various products falling under Item 68. The letters of the Superintendent are on the following lines : I forward herewith a set of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ant Collector of Central Excise, Balsar in another case. In that case the assessees had taken the plea that none of the officers of Central Excise were aware of the fact that the value of fully exempted goods falling under Tariff Item 68 had to be added to the value of the specified goods to determine whether they were entitled to the exemption contained in Notification No. 80/80, dated 19-6-1980. It had also been submitted that senior retired officers of the Central Excise Department shared this view, as seen from articles written by two such officers in the October and December 1982 issues of the Excise Customs Reporter. The Assistant Collector had in that case accepted the pleas of the assessees and held that no suppression of facts or ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... there was no general confusion on the part of the Department between non-excisable and exempted goods as had been claimed by the appellants. He submitted that the appellants should have been aware of the correct position in law and should have complied with the requisite Central Excise formalities and paid the duty. Therefore, according to him, the findings of the Collector were correct and the appeal deserved to be rejected. 14. We have carefully considered the submissions on both sides. The documents presented to us show clearly that there was a misunderstanding in the minds of the concerned Central Excise officers, even at the level of the Assistant Collector. The goods falling under Item 68 but exempted from duty were termed as ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he exemption under Notifications No. 71/78 and No. 80/80. As already stated, the show cause notice dated 12-8-1983 was issued more than six months after the period which it covered (the period ending in January, 1983). In the circumstances set out above, this would not be a case which would justify the invocation of the extended time-limit under Section 11A, as it cannot be said that there was any fraud or misstatement or suppression of facts by the appellants. (It is interesting that the Collector himself, in his finding, has held that the charges levelled against the appellants are conclusively proved except with regard to committal of fraud , which is tantamount to absolving them of misstatement, etc.). We accordingly hold that the dema ..... X X X X Extracts X X X X X X X X Extracts X X X X
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