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TMI Blog2022 (3) TMI 1269X X X X Extracts X X X X X X X X Extracts X X X X ..... ERSUS COMMISSIONER OF C. EX., DELHI [ 2005 (9) TMI 92 - SUPREME COURT ] wherein it was held that mere failure to declare does not amount to willful mis-declaration or willful suppression. There must be some positive act on the part of the party to establish either willful mis-declaration or willful suppression. When all facts are before the Department. Hon ble Apex Court in the case of Union of India vs Ashok Kumar and Ors. reported as [ 2005 (10) TMI 536 - SUPREME COURT ] observed that it cannot be overlooked that burden of establishing mala fides is very heavy on the person who alleges it. The allegations of mala fides are often more easily made than proved, and the very seriousness of such allegations demand proof of a high order of credibility. Reverting to the facts of the present case, there already was an audit in the year 2013 hence entire information was with the department since then. Also no shortcoming was noticed during that audit, question of evasion of duty for the same period does not at all arise. Invoking the extended period under the proviso of Section 11A is accordingly not sustainable. Demand for extended period is barred by time. For the normal period ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... re this Tribunal. 2. I have heard Dr. Prabhat Kumar, learned Counsel for the Appellant and Shri Ravi Kapoor, learned Authorised Representative for the Department. 3. It is submitted that demand raised vide the impugned Show Cause Notice was barred by time as it was issued after expiry of 5 years. There was no alleged suppression on the part of the appellant. The Department had already conduced the audit for the period 2012-2013 as was conducted in the year 2013, but no such objection was ever raised by them and no infirmity was pointed out and no demand was raised. The present Show Cause Notice includes the demand for the said period also which is legally not sustainable. The appellant was otherwise maintaining all relevant records which were being regularly audited by the Department. Question of any suppression of facts or collusion does not at all arise. Learned Counsel has submitted that the order under challenge is liable to be set aside on this ground itself. The position in the case of Nizam Sugar Factory vs Collector of Central Excise A.P. reported as [2006 (197) ELT 465 (SC)] has been impressed upon. It is further submitted that the penalty was not at all imposable fo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nt of duty along with interest payable thereon under section 11AA. (2) The person who has paid the duty under clause (b) of sub-section (1), shall inform the Central Excise Officer of such payment in writing, who, on receipt of such information, shall not serve any notice under clause (a) of that sub-section in respect of the duty so paid or any penalty leviable under the provisions of this Act or the rules made thereunder. (3) Where the Central Excise Officer is of the opinion that the amount paid under clause (b) of sub-section (1) falls short of the amount actually payable, then, he shall proceed to issue the notice as provided for in clause (a) of that sub-section in respect of such amount which falls short of the amount actually payable in the manner specified under that sub-section and the period of [two years] shall be computed from the date of receipt of information under sub-section (2). (4) Where any duty of excise has not been levied or paid or has been short-levied or short-paid or erroneously refunded, by the reason of- (a) fraud; or (b) collusion; or (c) any wilful mis-statement; or (d) suppression of facts; or (e) contravention of any of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... with intent to evade payment of duty. Therefore, there cannot be suppression or mis-statement of fact, which is not wilful and yet constitute a permissible ground for the purpose of the proviso to Section 11A. Mis-statement of fact must be wilful. 9. Coming to the facts of the present case, a mere fact that notification under which appellants were claiming exemption was not applicable to them, at the time of first audit, there was no reason with the appellant to discontinue the availment of exemption of NIL duty. Appellant stopped availing the same immediately it was pointed out by department at the time of 2nd audit. Thus there seems no mis-statement or suppression. The appellant, in addition, immediately paid the differential duty that too with interest and even penalty, question of any intent of evading duty by the appellant does not at all arise. I draw support from Hon ble Apex Court decision in the case of Pahwa Chemicals Private Limited vs Commissioner of Central Excise, Delhi reported as [2005 (189) ELT 257 (SC)] wherein it was held that mere failure to declare does not amount to willful mis-declaration or willful suppression. There must be some positive act on the p ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... vade payment of duty then it is not mere failure to pay duty. It must be something more. That is, the assessee must be aware that the duty was leviable and it must deliberately avoid paying it. The word `evade in the context means defeating the provision of law of paying duty. It is made more stringent by use of the word `intent . In other words the assessee must deliberately avoid payment of duty which is payable in accordance with law..... 12. Department has not produced any such evidence . In another judgement in the case of Anand Nishikawa Co. Ltd. v. Commissioner of Central Excise, Meerut reported as [2005 (188) ELT 149(S.C.)], while referring to the observations made in Pushpam Pharmaceuticals Company reported as [1995 (78) ELT 401 (SC)], Hon ble Supreme Court clarified the requirements of the proviso to Section 11-A, as follows :- 26... This Court in the case of Pushpam Pharmaceuticals Company v. Collector of Central Excise, Bombay (supra), while dealing with the meaning of the expression suppression of facts in proviso to Section 11A of the Act held that the term must be construed strictly, it does not mean any omission and the act must be deliberate and willful ..... X X X X Extracts X X X X X X X X Extracts X X X X
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