9911796707
TMI Blog1991 (3) TMI 161X X X X Extracts X X X X X X X X Extracts X X X X ..... ter-signed by the Assistant Collector, Central Excise, Meerut, on 6th February, 1973. The petitioners say further that in accordance with the said approval, they were clearing the goods without paying duty and have been regularly submitting returns in forms RT 5 and RT 12 in accordance with Rules 55 and 173. It is also submitted that Central Excise Officers were visiting the petitioner's factory from time to time and were satisfied about the correct and proper working of the petitioner-concern. While so, the petitioners complain, they received a notice dated 7th April, 1975, issued by the Superintendent, Central Excise, calling upon the petitioners to show cause why penalty should not be imposed on them under Rule 173Q for the reason that the petitioners have sold 45019 Kgs. of electrolytic grade aluminium wire without payment of duty. The petitioners submitted a reply thereto and were also heard by the Assistant Collector. Thereafter, the show cause notice was amended by way of a corrigendum, whereunder action proposed was related to Rule 9(2) instead of Rule 173Q. The petitioners again represented that they have not violated any of the provisions of the Central Excise Rules, but ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nalty imposed on the appellants is, therefore, vacated. Except for the above modification the order passed by the Assistant Collector, Central Excise, Meerut, is upheld and the appeal is otherwise rejected." Against this order, the petitioner preferred a revision to the Government, which was dismissed with an observation that the Government are unable to see any substance in the two contentions urged by the petitioners, namely, (1) that the Assistant [Appellate?] Collector was not justified in sustaining the levy under Rule 10, having found that Rule 9(2) was not applicable and (2) that the Assistant Collector was not competent to correct the error committed by his predecessor in approving the classification list (holding the goods non-dutiable). 3.In this writ petition, it is contended by Sri Bharat Ji Agarwal, learned Counsel for the petitioners, firstly that it was not open to the Appellate Collector to have sustained the levy of duty under Rule 10, which was never invoked by the Assistant Collector (Adjudicating Officer). He submitted that Rule 9(2) and Rule 10, as they stood at the relevant time, are qualitatively different and, it is not merely a case of citing a wrong pr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... vides for a situation where excisable goods are removed from the specified place without paying the duty, that is, in contravention of sub-rule (1). In such a case, the proper officer is empowered to collect the appropriate duty and also to levy penalty. Even the goods so removed can be confiscated. 5.Rule 10, as originally enacted, and in force during the period relevant herein, read as follows :- Recovery of duties or charges short-levied, or erroneously"10. refunded. - When duties or charges have been short-levied through(1) inadvertence, error, collusion, or misconstruction on the part of an officer, or through mis-statement as to the quantity, description or value of such goods on the part of the owner, or when such duty or charge, after having been levied, has been owing to any such cause, erroneously refunded, the proper officer may, within three months from the date on which the duty or charge was paid or adjusted in the owner's account-current, if any, or from the date of making the refund, serve a notice on the person from whom such deficiency in duty or charge is or are recoverable requiring him to show cause to the Assistant Collector of Central Excise why he shou ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in Rule 10 can reasonably be interpreted to mean "ought to have been paid". It was also held that the rule applies not only to short-levy of duty but also to non-levy of duty. (We may mention that this aspect was clarified and Rule 10 was expressly made applicable to cases of non-levy also by the amendment made in August, 1977). It is thus clear that the present case squarely fell within Rule 10, as it stood at the relevant time. But, the difficulty in the way of Revenue is that the action was not taken within the period prescribed by Rule 10. At the relevant time, the rule provided that the notice to show cause must be given "within three months from the date on which the duty or charge was paid." By virtue of the judgment of the Supreme Court referred to above, the word "paid" must be read in this case as "ought to have been paid". Now, the duty demanded is for 30-2-1974 to 18-10-1974. The duty was payable on the dates of removal of the goods, that is, during the said period, but the show notice was issued on 7-4-1975, i.e., beyond three months from 18-10-1974. The show cause notice was thus clearly barred by time. The Appellate Collector, however, applied the substituted Rule 10 ..... X X X X Extracts X X X X X X X X Extracts X X X X
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