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TMI Blog1997 (8) TMI 82X X X X Extracts X X X X X X X X Extracts X X X X ..... ms, Pune issued a Notice under Section 35A of the Central Excises and Salt Act, 1944 intimating his intention to set aside the impugned order passed by the Assistant Collector and calling the petitioners to show cause why the said order should not be modified as proposed. On 12th June, 1980, the Collector, Central Excise and Customs, Pune annulled the Order dated 8th December, 1977 passed by the Assistant Collector, Central Excise, Aurangabad and held that the product is liable for excise duty under Item No. 15A(2) of the 1st Schedule to the Central Excises and Salt Act, 1944. He has directed the Assistant Collector, Central Excise, Aurangabad to determine the differential duty due on the polyester film cleared by the party at rates appropriate for Tariff Item No. 68 and the duty actually due under Tariff Item No. 15A(2) of the C.E.T. and raise demands for the same. This Order dated 12-6-1980 has been challenged in this petition. 3.Shri R.G. Sheth, learned Counsel appearing for the petitioner, raised following points assailing the order of the Collector impugned in this writ petition :- Revision of the Order passed by the Assistant Collector made by the Collector was beyond the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ct, 1944, as it stood prior to the amendment made in the year 1978 was as under :- 35A.Revision by Board. - The Central Board of Excise and Customs constituted under the Central Boards of Revenue Act, 1963, may, of its own motion or otherwise, call for and examine the record of any proceeding in which any decision or order has been passed under this Act or the rules made thereunder (not being a decision or order passed on appeal under Section 35) for the purpose of satisfying itself as to the correctness, legality or propriety of such decision or order and may pass such order thereon as it thinks fit : Provided that no decision or order shall be varied so as to prejudicially affect any person unless such person is given a reasonable opportunity of making a representation and, if he so desires, of being heard in his defence : Provided further that no proceedings shall be commenced under this section in respect of any decision or order (whether such decision or order has been passed before or after the coming into force of this section) after the expiration of a period of one year from the date of such decision or order. As would be seen that the powers to revise on its own m ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... or after the commencement of the Customs, Central Excises and Salt and Central Boards of Revenue (Amendment) Act, 1977] after the expiration of a period of one year from the date of such decision or order. The substitution of Section 35A brought out two major changes. Firstly, apart from the power of the Central Board of Excise for examining the correctness, legality and propriety of any decision or order and revise it. Collector was also entrusted with the similar power in respect of the orders passed by his subordinates. Secondly, it was clarified that if the order to be passed under revision levies or enhances duty or requires payment of the duty refunded, it will have to be made after giving show cause notice to the person affected within the time limits specified in Section 11A. Section 11A prescribes limitation different from prescribed by Section 35A. Therefore, if the order is covered by sub- section 3(b) of Section 35A, then it will have to be passed after a notice is served on the affected parties within six months and in the case of fraud, misrepresentation and suppression of facts within five years. Other orders which do not order the levying or enhancing of the duty ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ich tariff duty of a particular product would come. Every assessee is required to file a list of classification for the approval of the officer and the officer has to approve it or reject it and determine the correctness thereof. After this determination, the duty is paid by assessee. The process of revision of any order in respect of classification is in effect an order revising the liability to pay the duty in respect of the quantum and, therefore, direct impact of any order passed under Rule 173B or any revisional jurisdiction exercised under Section 35A is to vary the liability to pay the duty, to recover the duty either not levied, short levied or wrongly refunded. There is no other purpose of the classification. Various other orders which can be passed under the Excise Act do not have such a direct impact on re-determining the levy which is payable by the assessee. The nature of the order impugned in this writ petition can speak for itself. After annulling the order of the Assistant Collector, the operative part of the order passed by the Collector of Central Excise and Customs, Pune runs thus - "I direct that the Assistant Collector of Central Excise, Aurangabad shall dete ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nsidered the distinction and examined the validity of a submission made which was similar to the one which the Counsel proposes to advance before us. Supreme Court said :- "Mr. Ganguli the learned Senior Counsel for the Revenue contended that by the show cause notice all that the Revenue was trying to do was to correct the procedure in the matter of calculation of duty and if as a consequence thereof there is a shortfall which the assessee may be called upon to make good the case would not fall in the third proviso and but would be governed by the second proviso. As against this, contention of the Counsel for the assessee Mr. Dave is that if the ultimate impact of the action contemplated by Section 36(2) is to recover a shortfall in the duty payable by the assessee the case falls within the purview of the third proviso to Section 36(2). Having regard to the historical background it seems to us that the legislature desired that cases of non-levy, short-levy and erroneous refund should receive a different treatment and the period of limitation should be consistent with the period of limitation under Section 11A of the Act, that is to bring about a uniformity in the matter, of corre ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... was prescribed by Section 11A. 10.Section 35A(3)(b) makes it abundantly clear that where the Board or as the case may be, the Collector of Central Excise is of opinion that any duty of excise has not been levied or has been short-levied or erroneously refunded, no order levying or enhancing the duty, or no order requiring payment of the duty so refunded, shall be made under this section unless the person affected by the order is given notice to show cause against it within the time limit specified in Section 11A. 11.Therefore, we hold that the Collector had no jurisdiction to revise the order passed by the Assistant Collector accepting classification submitted by the petitioner in respect of his product polyester film beyond the period of limitation prescribed and, therefore, the order will have to be quashed. The order of the Collector impugned in this writ petition may not sustain on one more ground. Power to revise an order passed by subordinates were entrusted to the Collector of Central Excise by substitution of Section 35A on 1st July, 1978. It was contended by the learned Counsel for the petitioner Shri Sheth that the Collector had no jurisdiction to revise any order wh ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t initiated by service of show cause notice on the assessee as is required by Section 11A read with Section 35A(3)(b) of the Central Excises and Salt Act within limitation. 13.Shri Deo, learned Counsel for the Union of India, contended that during the pendency of this writ petition because of the statutory amendments, Revision filed against the order of the Collector came to be converted into Appeal before the CEGAT but the said Appeal was withdrawn by the petitioners. Since Appeal was allowed to be withdrawn, this writ petition itself would not be maintainable. On the date when the Appeal was withdrawn, this petition was admitted and was pending before this Court. The Appeal was allowed to be withdrawn on 11-12-1990. The order passed by the learned Members of the CEGAT mentions that Excise Appeal No. 68/80-C is sought to be withdrawn on the ground that the same matter is before the Hon'ble High Court, Bombay i.e. Writ Petition No. 972/1980 which was admitted and the interim relief was granted. Counsel for the Department of Revenue had no objection for the grant of this prayer. On the basis of this, the learned Members of the CEGAT permitted the petitioner to dispose of the Appea ..... X X X X Extracts X X X X X X X X Extracts X X X X
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