9911796707
TMI Blog1984 (3) TMI 70X X X X Extracts X X X X X X X X Extracts X X X X ..... of the Central Excise Rules, 1944. It granted exemption to extruded shapes or sections of aluminium, including extruded pipes and tubes, if manufactured out of duty paid aluminium in any crude form or duty paid aluminium manufactures. The exemption granted was from so much of the excise duty leviable on the extruded shapes or sections under Item 27(d) as was equivalent to the duty already paid on aluminium manufactured under Item 27(b). 4. A Trade Notice was issued by the Bombay Central Excise Collectorate on 25th August, 1965 which required manufacturers who desired to avail of the exemption to follow the procedure under Rule 56A of the Central Excise Rules. 5. On 8th September, 1965 the petitioners applied for permission to avail of the "refund of excise duty and special duty paid on raw material, viz., aluminium slugs and sheets used for manufacturing of aluminium collapsible tubes, Tariff Item No. 27(d) under Rule 56A of Proforma Credit from 3rd April, 1965". On 15th September, 1965 the petitioners were granted permission to avail of the procedure under Rule 56A "for the raw material of which has paid duty under sub-item (a) and (b). No. 27". This permission was granted ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... otice of demand for payment of excise duty under Rule 10A. The demand was in the sum of Rs. 85,491.94. It was made in respect of 'proforma credit on aluminium flat bar sections during the period May 1966 to 24th February, 1968..." 11. On 21st September, 1973 the appellants filed a writ petition challenging the order of the Government of India in revision and the notice of demand under Rule 10A. At the hearing of the petition it was urged that the exemption in respect of aluminium flat bar sections covered under Item 27(d) ought to have been granted from the date upon which the exemption notification had come in force. It was also urged that the demand notice was bad inasmuch as Rule 10A has no application. The learned Single Judge rejected both the contention and dismissed the petition. As regards the second contention he observed that he was satisfied that this was not a case of short-levy which attracted the provisions of Rule 10, it was a case not of re-opening of assessments but of rectifying an error in collection and that, therefore, Rule 10A applied. 12. Being aggrieved by the judgment and order of the learned Single Judge the appellants have preferred this appeal. Mr. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... admitted position that assessments in respect of finished products manufactured by the appellants have been completed. The assessments have been made in respect of finished products made from aluminium flat bar sections covered by Item 27(d) in the manner that has been applied to finished products made from raw material covered by Item 27(a) and (b) to which, admittedly, the procedure under Rule 56A had been made applicable. Full duty was made payable on the finished products because the procedure under Rule 56A was applied and, thereunder, credit for the excise duty paid on the raw material had already been given in the appellant's account. Credit was so given because the finished products made from raw material covered by Item 27(a) and (b) and, mistakenly, (d) were given the benefit of the exemption. The assessments were, therefore, made, as they could not but have been made, at the exempted rate for finished products made out of raw material covered by Item 27(a) and (b). The assessments were also so made, though mistakenly, for finished products manufactured out of aluminium flat bar sections covered by Item 27(d). 17. In our view there was, thus, in respect of finished pro ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ct. Taken overall, the assessment of excise duty on all the finished products is at the full rate leviable thereon less the amount of the excise duty paid on all the raw material. There is under-assessment where credit is inadvertently or erroneously given in respect of raw material to which the procedure under Rule 56A has not been made applicable, and there is short-levy. The assessment has then to be reopened. Rule 10 applies and Rule 10A is excluded. 22. Mr. Dalal drew our attention to the judgment in N.B. Sanjana v. The Elphinstone Spinning and Weaving Mills Co. Ltd.-l978 E.L.T. (J 399)= AIR 1971 S.C. 2309 and to the observation of the Supreme Court therein that the charging provision stated, "These shall be levied and collected in such a manner as may be prescribed the duty of excise..." We note that the fact that both expressions 'levied' and 'collected' are used shows that the expression 'levy' has not been used in the sense of actual collection. In the matter of Assistant Collector of Central Excise, Calcutta v. National Tobacco Company of India Ltd.-1978 E.L.T. (J 416) (S.C.)=AIR 1972 S.C. 2563, the Supreme Court observed that Rule 10 should be confined to cases where ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rror, under-assessment and short-levy of excise duty upon finished products manufactured by the appellants during the relevant period from aluminium flat bar sections covered by Item 27(d). To the recovery of such short-levy the provisions of Rule 10 are attracted. The provisions of Rule 10 being attracted, the provisions of Rule 10A are excluded. 26. Rule 10 provides a time-limit of three months for the issue of a notice thereunder. The period of three months having long since expired, the demand notice dated 28th August, 1973 though it be issued under Rule 10A, cannot be treated as a notice under Rule 10. 27. The impugned Judgment and order are, accordingly, set aside. The appeal is allowed in terms of prayer a(ii) of the petition. The respondent shall pay to the appellants the costs of the appeal. 28. Pursuant to an interim order in the appeal, passed on 1st August, 1979, the appellants have deposited in court the full amount claimed under the demand notice. The appellants shall be entitled to withdraw the same. On Mr. Dalal's application, the appellants are permitted to withdraw the same only after the expiry of 10 weeks from today. 29. Mr. Dalal orally applies for ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
