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TMI Blog2023 (2) TMI 893X X X X Extracts X X X X X X X X Extracts X X X X ..... pon him under the provisions of Rules 9(B), 52A, 173(B), 173(F) and 173(G) of Central Excise Rules, 1944 and Section 11A of the CEA, 1944 alleging less payment of duty due to misclassification. The respondents had kept the impugned show cause notice and ten other SCNs as indicated in the chart above in the call book on the ground that the matter was sub-judice. However, from the pleadings on record and also from the averments made in the counter affidavit, it appears that none of the conditions as enumerated in the CBIC circular / guidelines relied upon by the respondents and also by the petitioner stood satisfied for transferring the matter to the call book. Similar issue perused in Punjab and Haryana High Court in the case of M/S GPI TEXTILES LIMITED VERSUS UNION OF INDIA AND OTHERS [ 2018 (9) TMI 25 - PUNJAB HARYANA HIGH COURT ] where the show cause notices issued under Section 11 A of the Central Excise Act 1944 were kept pending for 16 years. The present case is a gross one as the impugned show cause notice are kept pending since 9th December 1993 for 29 years and even if some explanation on the part of the respondents relating to pendency of Civil Appeal No. 3793 of 2001 till ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Shop for manufacturing, assembling, erecting and testing electronic overhead cranes (for short 'EOC') for installation in the main steel plant of the petitioner at Jamshedpur. In terms of the work order, the growth shop of the petitioner manufactured the said cranes and cleared the same to the petitioner. A show cause notice was issued to the petitioner by the Collector of Central Excise, Jamshedpur on 8th February 1984 alleging that the growth shop has removed electronic overhead crane without payment of duty. It was further alleged that the growth shop wrongly availed the benefit of exemption notification no. 118/75-CE dated 30.04.1975 as the goods cleared were not parts of crane but a fully functional crane. At the relevant point of time, excise duty was payable at different rates on parts of crane and crane, which are as under :- Goods Chapter Heading Rate of Duty Crane 8431 20% ad valorem Parts of Crane 8426 15% ad valorem 4. Petitioner submitted his reply and rebutted the allegations but was held exigible to excise duty @ 20% ad valorem as the adjudicating authority Collector of Central Excise held that petitioner had removed goods which were fully functional crane ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... itiated against the petitioner pursuant to the impugned show cause notice dated 9th December 1993 till the judgment delivered by the Apex Court on 5th May 2004. In this background, it is contended that after a lapse of 29 years a notice for personal hearing has been issued to the petitioner on 30th November 2022 fixing the date of hearing as 15th December 2022. Petitioner made a request for adjournment of personal hearing on 15th December 2022 and accordingly the matter was adjourned for eight weeks. Another notice was issued for personal hearing by respondent no. 4 on 23rd December 2022 fixing the date of hearing on 15th February 2023. Therefore, the petitioner has been compelled to approach this Court. 6. Learned Senior Counsel for the petitioner has referred to the contents of the counter affidavit filed by the respondents pursuant to the previous order and contested the stand of the respondents inter alia on the following grounds : Learned Senior Counsel for the petitioner submits that the stand of the respondents is based upon the SCN being kept in a call book pursuant to the waiver of pre deposit granted by Learned CEGAT in the year 1991. It is submitted that the impugned ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 28th May 2003 and 1053/2/2017-CX dated 10th March 2017 that the competent authorities have been mandated to carry out periodic monthly review of SCNs kept in a call book. The respondents have not given a semblance of an answer as to whether any such periodical review was carried out by the competent authority. Referring to the Circular dated 10th March 2017, Clause 9.4 it is also submitted that whenever a case has been transferred to the call book a formal communication should be issued to the noticee. It is submitted that various courts have disapproved of such an approach to revive an adjudication proceedings after an inordinate delay in view of the conditions stipulated under Section 11 A (11) of the CEA. The expression 'if it is possible to do so' used in Section 11A(11) cannot by any stretch of imagination be extended for a period of 29 years to adjudicate upon such a show-cause notice. Any such stipulation in a statute, which does not prescribe an outer period of limitation can be understood as laying down only a reasonable period of limitation which cannot be extended to an infinite period such as in the present case. It is submitted that the records relating to the said per ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Ns/SODs issued upon the petitioner for subsequent period. The particulars of all 11 SCNs/SODs have been furnished in the form of a tabular chart under paragraph 8 of the counter affidavit which is also extracted hereunder : Sl. SCN Reference Period Amount (in Rs.) 1. MP-14/TGS/DD/92/970 dated 09.12.1993 June 1993 to Nov.1993 1,67,42,847 2. MP-14/TGS/DD/92/511 dated 30.06.1994 Dec. 1993 to May 1994 4,22,53,259 3. MP-4/TGS/DD/95/1127 dated 03.01.1995 June 1994 to Nov.1994 2,00,97,070 4. MP-13/TGS/DD/95/552 dated 03.07.1995 Dec. 1994 to May 1995 82,90,798 5. MP-13/TGS/DD/95/5 dated 02.01.1996 June 1995 to Nov.1995 12,65,486 6. MP-13/TGS/DD/95/986 dated 18.06.1996 Dec. 1995 to May 1996 1,23,09,779 7. MP-13/TGS/DD/95/1584 dated 31.12.96 June 1996 to Sep. 1996 34,66,340 8. MP-20/SCN/III/97/361 dated 25.04.1997 Oct.1996 3,72,906 9. MP-20/SCN/III/97/600 dated 28.05.1997 Nov.1996 to Dec. 1996 25,57,879 10. MP-20/SCN/III/97/598 dated 28.05.1997 Nov.1996 to Dec. 1996 23,03,659 11. MP-20/SCN/III/97/744 dated 01.08.1997 Jan 1997 to Feb 1997 12,10,209 10. The present writ petition relates to the show cause notice a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t levy or short payment of duty of central excise in terms of Section 11A of the CEA and the Central Excise Rules. The officers of the central excise have been vested with powers under Section 33 A of CEA to adjudicate the show-cause notice to the noticees. They act as quasi judicial officers in that capacity. A fair opportunity to the noticee for replying the show cause notice is being given and also time for personnel hearing on his request. 12. Learned counsel for the Central Excise submits that a call book of such cases which cannot be adjudicated immediately due to certain specified reasons and adjudication is to be kept in abeyance. The categories of such cases to be transferred to call book are enumerated under para 11 page 14 of the counter affidavit, which are inter alia quoted hereunder : i. Cases in which the Department has gone in appeal to the appropriate authority. ii. Cases where injunction has been issued by Supreme Court/High Court/CEGAT, etc. iii. Cases where the Board has specifically ordered the same to be kept pending and to be entered into the call book. iv. Cases admitted by the Settlement Commission may be transferred to the call-book, as it is alre ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of clarification. The application is rejected." (Annexure-E4). 15. Learned counsel for the respondents has also taken us to the different positions in respect of the two show cause notices one dated 8th February 1984 wherein it was alleged that the subject notice was supplying EOT crane which was excisable community leviable to the duty but had claimed exemption by taking benefit of notification no. 118 of 75 on the ground that they were engaged in manufacturing parts of EOT crane. Subsequent SCN dated 13th August 1990 demanded differential duty of Rs. 7,60,179.60 for the period January 1989 to January 1990 alleging that he had cleared goods by classifying as "Crane, chargeable under 8426.00 of CETA, 1985" instead of "Crane Parts, chargeable under 8431.00 of CETA, 1985. These developments have been duly discussed in the earlier parts of the counter affidavit at paragraph 2.1 to 2.4. Learned counsel for the Central Excise submits that the change in the tariff rate has necessitated the issuance of the second show cause notice and similar show cause notices, one of which is impugned herein. 16. Falling back upon the CBIC circular, it is contended that the competent authority i.e. t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r / guidelines relied upon by the respondents and also by the petitioner stood satisfied for transferring the matter to the call book. It is not a case where the department had gone in appeal before the learned CEGAT or before the Apex Court, rather it was the petitioner who twice went up to the Apex Court in Civil Appeal No. 782 of 1987 against the first SCN dated 8th February 1984 and in Civil Appeal No. 3973 of 2001 against the SCN dated 13th August 1990. The instant SCN pertains to the period June 1993 to November 1993 and is of 9th December 1993. Learned counsel for the respondents has fallen back on Clause 2 of the condition stipulated in the CBIC circular as referred to in para 11 of their counter affidavit but he has not been able to show that at any point of time there was a stay in proceeding upon the impugned show cause notice by either the CEGAT or the High Court or the Hon'ble Apex Court. Even if by stretching the argument to the extent that the show cause notice dated 13th August 1990 was sub-judice before the Apex Court in Civil Appeal No. 3973 of 2001, there is no basis or explanation on the part of the respondents to have kept the show cause notice in its call book ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... visions of Section 11A of the CEA which reads as under :- SECTION 11A OF THE CENTRAL EXCISE ACT, 1944 "SECTION 11A- Recovery of duties not levied or not paid or short-levied or short-paid or erroneously refunded. - (1) Where any duty of excise has not been levied or paid or has been short-levied or short-paid or erroneously refunded, for any reason, other than the reason of fraud or collusion or any willful mis- statement or suppression of facts or contravention of any of the provisions of this Act or of the rules made thereunder with intent to evade payment of duty,- xxx xxx xxx (4) Where any duty of excise has not been levied or paid or has been short-levied or short- paid or erroneously refunded by reason of - (a) fraud; or (b) collusion; or (c) wilful mis-statement; or (d) suppression of facts; or (e) contravention of any of the provisions of this Act or of the rules made thereunder with intent to evade payment of duty. by any person chargeable with the duty, the Central Excise Officer shall, within five years from the relevant date, serve notice on such person requiring him to show cause why he should not pay the amount specified in the notice along ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s possible to do so". The opinion of the learned Bombay High Court at para 14 to 17 are quoted hereunder for easy reference: 14. Perusal of the show cause notice shows that the breach alleged for initiating action for demanding the forgone import duty was on the ground of irregular exports by the exporters and breach of the provisions committed by the exporters. It is not in dispute that the Petitioner had promptly replied the show cause notice well within time in the year 2014 itself. It is further not in dispute that the Petitioner was never intimated in respect of any adjudication of the show cause notice and/or any decision of keeping the adjudication pending. Thus, the Petitioner is justified in submitting that the Petitioner was under bonafide belief that the Respondents were not interested in adjudicating the show cause notice and that the same was dropped. Though the Respondent Nos. 1 and 2 have sought to justify their action to revive the show cause notice after a period of 9 years, the contentions raised by the Respondent Nos. 1 and 2 are unreasonable and not supported by any statutory provisions. 15. We have perused the consistent view taken by this Court, that the c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eking revival of the same after a period of 9 years. For the reasons recorded above, the show cause notice impugned in the Petition is required to be quashed and set aside and it is also necessary to prohibit the Respondent from adjudicating the show cause notice any further." 22. Similar is the view expressed by the Punjab and Haryana High Court in the case of GPI Textiles Limited Vrs. Union of India [2018 (362) ELT 388 (P&H)] where the show cause notices issued under Section 11 A of the Central Excise Act 1944 were kept pending for 16 years. The present case is a gross one as the impugned show cause notice are kept pending since 9th December 1993 for 29 years and even if some explanation on the part of the respondents relating to pendency of Civil Appeal No. 3793 of 2001 till 05.05.2004 is accepted, there is no justification for not proceeding upon the impugned show cause notice for 18 years thereafter till the impugned notice of personal hearing has been served upon the petitioner. Adjudication of such a show cause notice after 29 years would be contrary to the mandate of Section 11A(11) of the CEA 1944 and would lead to unreasonable and arbitrary results. Such proceedings ther ..... X X X X Extracts X X X X X X X X Extracts X X X X
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