TMI Blog2013 (6) TMI 120X X X X Extracts X X X X X X X X Extracts X X X X ..... on of exemption is directly and proximately related to the rate of duty for the purposes of assessment of excise duty payable by the respondent. The appeal on the said question is clearly excluded under Section 35-G and can be filed by the revenue before the Apex Court under Section 35-L of the Act. Thus the preliminary objection of the respondent regarding maintainability of appeal is upheld and Central Excise Appeal Defective No.- 402 of 2005 is held not maintainable under Section 35-G of the Act. - The appeals are maintainable before Apex Court - Decided against the revenue. - Central Excise Appeal Defective No.-402 of 2005, Central Excise Reference No. - 11 of 2004 - - - Dated:- 6-7-2012 - Ashok Bhushan And Prakash Krishna, JJ. For the Petitioner : K. C. Sinha, Ritvik Upadhya For the Respondent : S. P. Kesarwani, Subodh Kumar JUDGMENT (Delivered by Hon'ble Ashok Bhushan, J.) The Central Excise Appeal Defective No.402 of 2005 has been heard along with Central Excise Reference No.11 of 2004. Central Excise Reference No.11 of 2004 arose out of Central Excise Reference Application Defective No. 11 of 2001 which case was directed to be listed along with Central E ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ondoned. The delay condonation application is allowed. The facts giving rise to central excise reference application, central excise reference and central excise appeal may now be noted in chronological order. M/S Eco Products India Pvt. Ltd., the assessee, was engaged in the manufacture of water filter and part thereof falling under Chapter Heading No.8421.10 8421.90 of the Schedule to Central Excise Tariff Act, 1985. A show cause notice dated 30th May, 1997 was issued to the assessee alleging that the assessee had incorrectly availed the exemption under the Notification No.01/93 dated 28.2.1993 as amended and thereby short paid central excise duty amounting to Rs.1,05,455.60 on the goods cleared during November, 1996 to March, 1997. The assessee was alleged to have availed the benefit of concessional rate of duty in terms of the above notification in respect of clearance of excisable goods manufactured by them affixing with brand name "AQUARIUS" which appeared to be brand name owned by M/s Singer India Limited. The assessee had appointed M/s Singer India Limited as their exclusive distributor for product. The Assistant Commissioner, Central Excise adjudicated the show cause ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... for disposal afresh. Consequent to the order of the Apex Court dated 27th February, 2006 the Central Excise Reference Application Defective No.11 of 2001 has revived rendering the Central Excise Reference No.11 of 2004 as infructuous. Now the facts giving rise to Central Excise Appeal Defective No.402 of 2005 are to be noted. The officers of the Central Excise have visited the factory premises on 16th November, 1998 and found that 1216 number of water filters have been received back by the assessee after expiry of stipulated period of one year from the date of their initial clearances from the factory. It was revealed that ''D-3 Intimation' was filed in respect of 1087 number of water filters but no such intimation was filed in respect of remaining 129 number of water filters. It was further revealed that aforesaid 1216 number of water filters were cleared without payment of duty under Challan dated 15.8.1998 after expiry of stipulated period of six months from the date of their receipt. A show cause notice dated 12th February, 1999 was issued asking as to why central excise duty of Rs.3,03,109/- involved on 1216 water filters should not be demanded and also proposing penalty un ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tion? 3. Any other points of law that this Hon'ble Court may deem fit and proper for order in relation to the issue under consideration." The Central Excise Appeal Defective No.402 of 2005 is being treated as leading case. At the very threshold of hearing Sri V.K. Upadhya, learned Senior Advocate, appearing for the assessee, raised a preliminary objection regarding maintainability of the appeal. Sri Upadhya submits that revenue has filed the appeal under Section 35-G of the Central Excise Act, 1944 (hereinafter referred to as the Act) against the order of CESTAT allowing SSI exemption to the goods manufactured by the respondents. In the appeal filed by the revenue ground has been taken that brand ''AQUARIOUS-II' was owned by M/s Singer India Limited and water purifiers manufactured by the respondent under the said brand name were not eligible for exemption/concession under the Notification No.1/93, dated 28th February, 1993. Sri Upadhya submits that the issue, which has been raised in the appeal by the revenue relates to determination of a question having relation to the rate of duty of excise for the purposes of assessment, hence the appeal could have been filed only under S ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sment i.e. matters arising from proceeding under Rule 7 of the 2002 Rules or under Rule 9B of the erstwhile Central Excise Rules, 1944. In other cases including the instant case where clandestine removal of goods is involved and the provisions of Section 11-A(1) is invoked, the appeal before the High Court under Section 35-G of the Act can not be barred. It is further submitted that right of appeal under Section 35-G of the Act being a statutory remedy and a substantive right, it should be interpreted liberally while that portion of this Section which excludes the right of appeal to the High Court, has to be construed strictly and in a restrictive sense. He submits that Section 11-A of the Act is recovery and penal provision and the proceeding under Section 11-A being a proceeding for recovery of duty and penalty, no question of assessment is involved and the exclusionary clause under Section 35-G(1) shall not be attracted. He further submits that present is not a case of provisional assessment or assessment. Learned counsel for both the parties have relied on various judgments of the Apex Court, this Court and other High Courts which shall be referred to hereinafter while consid ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y on the question so formulated, and the respondents shall, at the hearing of the appeal, be allowed to argue that the case does not involve such question: Provided that nothing in this sub‑section shall be deemed to take away or abridge the power of the Court to hear, for reasons to be recorded, the appeal on any other substantial question of law not formulated by it, if it is satisfied that the case involves such question. (5) The High Court shall decide the question of law so formulated and deliver such judgment thereon containing the grounds on which such decision is founded and may award such cost as it deems fit. (6) The High Court may determine any issue which (a) has not been determined by the Appellate Tribunal; or (b) has been wrongly determined by the Appellate Tribunal, by reason of a decision on such question of law as is referred to in sub‑section (1). (7) When an appeal has been filed before the High Court, it shall be heard by a bench of not less than two Judges of the High Court, and shall be decided in accordance with the opinion of such judges or of the majority, if any, of such judges. (8) Where there is no such majority, the Judges sha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eipt of such direction, draw up a statement of the case and refer it to the High Court.] ........... 35L. Appeal to the Supreme Court.- An appeal shall lie to the Supreme Court from- (a) any judgment of the High Court delivered ‑ (i) in an appeal made under section 35G; or (ii) on a reference made under section 35G by the Appellate Tribunal before the 1st day of July, 2003; (iii) on a reference made under section 35H, in any case which, on its own motion or on an oral application made by or on behalf of the party aggrieved, immediately after passing of t1te judgment, the High Court certifies to be a fit one or appeal to the Supreme Court; or (b) any order passed by the Appellate Tribunal relating, among other things, to the determination of any question having a relation to the rate of duty of excise or to the value of goods for purposes of assessment." From the above provisions, two important features are decipherable. In Section 35-G which provided for statement of case to the High Court, the exclusionary clause i.e. "not being an order relating, among other things, to the determination of any question having a relation to the rate of duty of excise or to th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... estion of law so formulated and deliver such judgment thereon containing the grounds on which such decision is founded and may award such cost as it deems fit. (6) The High Court may determine any issue which - (a) has not been determined by the Appellate Tribunal; or (b) has been wrongly determined by the Appellate Tribunal, by reason of a decision on such question of law as is referred to in sub-section (1). (7) When an appeal has been filed before the High Court, it shall be heard by a bench of not less than two Judges of the High Court, and shall be decided in accordance with the opinion of such Judges or of the majority, if any, of such Judges. (8) Where there is no such majority, the Judges shall state the point of law upon which they differ and the case shall, then, be heard upon that point only by one or more of the other Judges of the High Court and such point shall be decided according to the opinion of the majority of the Judges who have heard the case including those who first heard it. (9) Save as otherwise provided in this Act, the provisions of the Code of Civil Procedure, 1908 (5 of 1908), relating to appeals to the High Court shall, as far as may be, ap ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... application are on the same questions. As noted above, central excise reference application was allowed by the Division Bench of this Court on 26th July, 2004 directing the appellate Tribunal to refer the aforesaid two questions to the High Court against which order special leave petition was filed by the assessee in the Apex Court where one of the arguments raised was that reference application was not maintainable at all. The Apex Court did not enter into the question as to whether reference was maintainable or not but set-aside the order of the High Court on the ground that it was allowed without notice to the assessee. It is useful to quote the order of the Apex Court dated 27th February, 2006 which is to the following effect:- "Delay condoned. Leave Granted. The appellant's grievance is that the High Court passed an ex parte order allowing the reference application of the respondents without notice to the petitioner holding that questions of law referred by the respondents did arise out of the order of the Tribunal. The order of the High Court is set-aside on this short ground alone. According to the appellant the reference application was not maintainable at all. We d ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s the moot question in the present appeal. What is the import and extent of the words "rate of duty" as used in Section 35-G of the Act and under Section 35-L(b) is to be considered. The rate of duty has not been defined in the definition clause of the Act. Chapter-II of the Act deals with levy and collection of duty. The words "duty and rate" have been mentioned in Section 3. Section 3 is the charging section of the Act which is quoted below:- "3. Duties specified in First Schedule and the Second Schedule to the Central Excise Tariff Act, 1985 to be levied. -- (1) There shall be levied and collected in such manner as may be prescribed, - (a) a duty of excise to be called the Central Value Added Tax (CENVAT)] on all excisable goods (excluding goods produced or manufactured in special economic zones) which are produced or manufactured in India as, and at the rates, set forth in the First Schedule to the Central Excise Tariff Act, 1985 (5 of 1986); (b) a special duty of excise, in addition to the duty of excise specified in clause (a) above, on excisable goods excluding goods produced or manufactured in special economic zones specified in the Second Schedule to the Central Ex ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ase exempt from the payment of duty, under circumstances of an exceptional nature, any excisable goods. (3) An exemption under sub-rule (1) or sub-rule (2) in respect of any excisable goods from any part of the duty of excise leviable thereon (the duty of excise leviable thereon being hereinafter referred to as the statutory duty) may be granted by providing for the levy of a duty on such goods at a rate expressed in a form or method different from the form or method in which the statutory duty is leviable and any exemption granted in relation to any excisable goods in the manner provided in this sub-rule shall have effect subject to the condition that the duty of excise chargeable on such goods shall in no case exceed the statutory duty." Subsequently Rule 8 was omitted with effect from 1st July, 1988 and the provisions for exemption have been inserted in the Act by inserting Section 5A of Act 29 of 1988 with effect from 1st July, 1988. Sub-Rule (3) of Rule 8 and sub-section (3) of Section 5A are to the same effect. The grant of exemption/concession has direct consequence to the rate of duty which can be levied on a manufacturer. Whether rate of duty as provided in schedule to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... accordance with the provisions of the Act without payment of excise duty under a exemption notification is taken as duty paid under the Act. Therefore, the question relating to eligibility of goods for exemption from payment of excise duty under an exemption notification is always a question relating to rate of duty. The question relating to eligibility of goods for exemption from payment of excise duty under an exemption notification if arises in the proceedings for assessment or determination of duty not paid or short paid would be a question relating to rate of duty for the purposes of assessment of duty payable. Sri S.P. Kesarwani, learned counsel for the appellant, refuting the above submissions, has submitted that in the present case no question pertaining to rate of duty has arisen so as to debar an appeal under Section 35-G of the Act. Sri Kesarwani submits that under the circumstances a demand-cum-show cause notice dated 12.2.1999 was issued demanding duty of Rs.3,03,109/- involved in clearance of 1216 number of water filters on 15th October, 1988. It is submitted that after further verification reports another demand-cum-show cause notice under Section 11A dated 12th Ma ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n having a relation to the rate of duty or to the value of goods for the purposes of assessment of any duty is in issue or is one of the points in issue. Explanation - For the purposes of this sub-section, the determination of a rate of duty in relation to any goods or valuation of any goods or valuation of any goods for the purposes of assessment of duty includes the determination of a question.- (a) relating to the rate of duty for the time being in force, whether under the Customs Tariff Act, 1975 (51 of 1975), or under any other Central Act providing for the levy and collection of any duty of customs, in relation to any goods on or after the 28th day of February, 1986; or (b) relating to the value of goods for the purposes of assessment of any duty in cases where the assessment is made on or after the 28th day of February, 1986; or (c) whether any goods fall under a particular heading or sub-heading of the First Schedule or the Second Schedule to the Customs Tariff Act, 1975 (51 of 1975), or that any goods are or not covered by a particular notification or order issued by the Central Government granting total or partial exemption from duty; or (d) whether the value of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... id goods allowing to the appellant the option of redeeming them upon payment of fine of Rs. 10,000/-. That the appellant might avail of the option, pay the fine and clear the said goods, when questions as to the rate of duty and value for purposes of assessment might possibly arise, is far too remote a contingency to satisfy the test that is laid down." The Apex Court in the said case laid down that a dispute as to the classification of goods and as to whether or not they are covered by an exemption notification relates directly and proximately to the rate of duty applicable thereto for purposes of assessment. Sri S.P. Kesarwani, learned counsel for the respondent tried to distinguish the above case on the premise that in the said case the said dictum was laid down by the Apex Court relying on the provisions of Explanation to Section 129-D of the Customs Act, 1962. In the above context, it is relevant to note that by the Customs and Central Excise Laws Amendment Act, 1988, both Custom Act, 1962 and the Central Excise Act, 1944 were amended. In sub-section (5) of Section 129-D of the Customs Act, 1962 the explanation was added by the same Amendment Act and same sub-section (5) ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... wisdom having provided an appeal to the Highest Court of the land by incorporating Section 35L in the Central Excise Act, the appellant, therefore, has a right of appeal to the Supreme Court and not to this Court as the issues raised in the appeal relate to the rate of duty and valuation of goods. He submits that as far as the valuation aspect is concerned, dispute between the parties relates to the assessable value based on the transaction value/valuation concept as contended by the Revenue; as against this; the value of contemporaneous import is the contention of the appellant. In his submission, there is also a dispute regarding valuation of intermediate product viz. principally; deperform. 13. Mr Sethna, while taking us through the order of the Tribunal tried to impress upon us, that the dispute between the parties relates to the valuation of both the optical fibre i.e. finished goods and that of the intermediate products; i.e. the deperforms. In his submission, the actual issue for determination as contended by the appellant is: whether applicable rate of duty would be under Section 3, or under proviso to Section 3(1) of the Central Excise Act. He submits that to determine t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lve around the rate of duty and valuation of goods for the purposes of assessment." The judgment of the Punjab and Haryana High Court in the case of Commissioner of Central Excise, Panchkula vs. Special Machine reported in 2009(242) E.L.T. 330 was also a case considering similar issue. In the said case also question of grant of exemption under the same Notification No.1/93-C.E., dated 28.2.1993 was under consideration. The Tribunal decided the appeal in favour of the assessee against which revenue had filed the appeal. In the appeal filed by the revenue one of the questions raised was noticed in paragraph 7(a) of the judgment, which is as under:- "7(a) Whether the clearance made by various units, is clubbable for the purpose of deciding eligibility for exemption under Notification No.175/86-C.E. as amended vide Notification No.1/93-C.E. dated 28.2.1993?" In the said case, the objection regarding maintainability of appeal under Section 35-G of the Act was raised which objection was sustained. Following was laid down in paragraphs 10 and 11 of the said judgment, which are as under:- "10. Having heard learned counsel for the parties and perusing the paper book with their able ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ). The Division Bench has relied upon the judgment of Hon'ble the Supreme Court in Navin Chemicals case (supra)." The judgment of the Gujarat High Court in the case of Commissioner of Central Excise Custom and Service Tax, Daman vs. Gandhi Fibers reported in 2011(268) E.L.T. 354 again similar issue was considered. Relying on the judgment of the Apex Court in Naveen Chemicals' case (supra), the Gujarat High Court held that classification dispute relates directly and proximately to the rate of duty and the appeal was not maintainable under Section 35-G of the Act. Following was laid down in paragraph 12 of the said judgment:- "12. Examining the facts of the present case in the light of the aforesaid decision of the Supreme Court, a bare reading of the proposed questions clearly indicates that the main controversy which arises for determination is in the nature of a classification dispute, which relates directly and proximately to the rate of duty applicable for the purposes of assessment. Section 35G of the Act lays down that an appeal shall lie to the High Court from every order passed in appeal by the Appellate Tribunal, not being an order relating, amongst other things, to the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... appreciate the phrase 'rate of duty' used in Sections 35Gand 35Lof the Act which reads as under: Explanation: For the purposes of this Sub-section, the determination of a rate of duty in relation to any goods or valuation of any goods for the purposes of assessment of duty includes the determination of a question- a) relating to the rate of duty of excise for the being in force, whether under the Central Excise Tariff Act, 1985 or under any other Central Act providing for the levy and collection of any duty of excise, in relation to any goods on or after the 28th day of February. 1986; or b) relating to the value of goods for the purposes of assessment of any duty in cases where the assessment is made on or after the 28th day of February, 1986. or c)whether any goods are excisable goods or whether the rate of duty of excise on any goods is nil: or d)whether any goods fall under a particular heading or sub-heading of the Schedule to the Central Excise Tariff Act. 1985, or the Additional Duties of Excise (Goods of Special Importance) Act, 1957 or the Additional Duties of Excise (Textiles and Textile Articles) Act, 1978, or that any goods are or not covered by a particular n ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... l income is, in our judgment not warranted. By the use of the expression "rate" in the context in which it occurs, undoubtedly a relation between the taxable income and the tax charged is intended, but the relation need not be of the nature of proportion of fraction. The expression "rate" is often used in the sense of a standard or measure. Provided the tax is computable by the application of a prescribed standard or measure, though not directly related to taxable income, it may be called tax computed at a certain rate. We agree with the High Court that the rebate of tax and the reduction of such rebate are essentially matters of measure or standards of rate." 41. Therefore, the expression 'rate' is often used in the sense of a standard or measure. 'Rate' generally is an impost, usually for current or recurrent expenditure, spread over a district or other local area and is distinct from an amount payable for work done upon or in respect of particular premises. 'Rate' is defined by Webster to be the price or amount staled or fixed for anything. The word 'rate' includes any toll, due, rent, rate or charge. It means the scale or amount of any other charges. The word "rate' is used w ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Once that is prescribed by the legislature in the Act, the Court cannot sit in judgment and alter or modify the said rate of tax. The Court has no jurisdiction to go into the correctness or otherwise of the rate of tax payable in the sense the rate prescribed by the legislature. Therefore, the argument that the rate of tax means only the rate at which tax is payable or a fraction is unsustainable." A Division Bench of Himachal Pradesh High Court in the case of Commissioner of Central Excise, Chandigarh vs. Chhabra Tube Products (P) Ltd. reported in 2010(252) E.L.T. 63, laid down that the phrase determination of a rate of duty has been deemed to include the question whether any goods are covered or not covered by a particular notification issued by the Central Government granting total or partial exemption from duty. Similar view has been taken by the Karnataka High Court in the case of Commissioner of Central Excise, Bangalore-I vs. MTR Foods Ltd. reported in 2011(267) E.L.T. 608. Again the Gujarat High Court in the case of Commissioner of Central Excise vs. JBF Industries Ltd. reported in 2011(264) E.L.T. 162, taken the similar view in which following was laid down in paragraph ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of goods under the Tariff and whether or not they are covered by an exemption notification; and whether the value of goods for the purposes of assessment should be enhanced or reduced having regard to certain matters that the said Act provides for. Questions relating to the rate of duty and to the value of goods for purposes of assessment are questions that squarely fall within the meaning of the said expression. A dispute as to the classification of goods and as to whether or not they are covered by an exemption notification relates directly and proximately to the rate of duty applicable thereto for purposes of assessment. Whether the value of goods for purposes of assessment is required to be increased or decreased is a question that relates directly and proximately to the value of goods for purposes of assessment. Determination of rate of duty in relation to any goods include determination of a question whether any goods or not, whether there is an import or not the process if any undertaken In the service centre amounts to manufacture or not, whether there is an "export" or not and if the goods imported or exported during are dutiable goods or not would fall within the meaning ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... payment of duty, by such person or his agent, the provisions of this sub-section shall have effect, 4[as if 5[***]] for the words 6["one year"], the words "five years" were substituted: (1A) When any duty of excise has not been levied or paid or has been short-levied or short paid or erroneously refunded, by reason of fraud, collusion or any wilful misstatement or suppression of facts, or contravention of any of the provisions of this Act or the rules made thereunder with intent to evade payment of duty, by such person or his agent, to whom a notice is served under the proviso to sub-section (1) by the Central Excise Officer, may pay duty in full or in part as may be accepted by him, and the interest payable thereon under section 11AB and penalty equal to twenty-five per cent. of the duty specified in the notice or the duty so accepted by such person within thirty days of the receipt of the notice. (2) Central Excise Officer shall, after considering the representation, if any, made by the person on whom notice is served under sub-section (1), determine the amount of duty of excise due from such person (not being in excess of the amount specified in the notice) and thereupon suc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e counted from the date of receipt of such information of payment. (2C) The provisions of sub-section (2B) shall not apply to any case where the duty had become payable or ought to have been paid before the date on which the Finance Bill, 2001 receives the assent of the President. (3) For the purposes of this section-- (i) "refund" includes rebate of duty of excise on excisable goods exported out of India or on excisable materials used in the manufacture of goods which are exported out of India; (ii) "relevant date" means,-- (a) in the case of excisable goods on which duty of excise has not been levied or paid or has been short-levied or short-paid-- (A) where under the rules made under this Act a periodical return, showing particulars of the duty paid on the excisable goods removed during the period to which the said return relates, is to be filed by a manufacturer or a producer or a licensee of a warehouse, as the case may be, the date on which such return is so filed; (B) where no periodical return as aforesaid is filed, the last date on which such return is to be filed under the said rules; (C) in any other case, the date on which the duty is to be paid under th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... erm "imposition" is gene- rally used for the, levy of a tax or duty by legislative provision indicating the subject matter of the tax and the rates at which it has to be taxed. The term "assessment", on the other hand, is generally used in this country for the actual procedure adopted in fixing the liability to pay a tax on account of particular goods or property or whatever may be the object of the tax in a particular case and determining its amount. The Division Bench appeared to equate "levy" with an "assessment" as well as with the collection of a tax when it. held that "when the payment of tax is enforced, there is a levy". We think that, although the connotation of the term "levy" seems wider than that of "assessment", which it includes, yet, it does not seem to us to extend to "collection"..... 21. ...... Moreover, it is the process of assessment that really determines whether the levy is short or complete. It is not a factual or presumed levy which could, in a disputed case, prove an "assessment". This has to be done by proof of the actual steps taken which constitute "assessment"." Section 11-A employs the word "determination". Section 11-A may in a particular case inv ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... has also placed reliance on the judgment of the Apex Court in the case of Collector of Central Excise, Baroda vs. Cotspun Limited reported in 1999(113) E.L.T. 353. In paragraph 12 of the judgment it was held that Rule 10 is a provision for recovery of duty. The issue which was considered in the said case was as to whether tariff duty can be recovered on the basis of approved classification. The said case does not help the appellant in the present case. The case of J.K. Cotton Spg. Wvg. Mills Co. Ltd. vs. Collector of Central Excise reported in 1998(99) E.L.T. 8 (SC) as relied by Sri Kesarwani, was again a case where the moot point for consideration was as to whether period of six months envisaged in Section 11-A for issuing show cause notice so as to enable the revenue to scale over the hurdle of limitation. The Apex Court in the said judgment laid down following in paragraph 9 which is as under:- "9. We agree with the learned counsel for the Revenue that the question sought to be determined in this appeal has neither any relationship to the rate of duty of excise or to the value of the goods for purpose of assessment. It may be that the appeal could not have been filed under ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... is recovery proceedings as regards non-levy, non-payment, short-levy or short-payment was made in different context and does not help the appellant in the present case. Reliance has also been placed by Mr. Kesarwani on the judgment of the Apex Court in the case of M/s Kushal Fertilizers Pvt. Ltd. vs. Commissioner of Customs Central Excise, Meerut reported in JT 2009 (13) SC 293. In the said case the question considered by the Apex Court was as to whether reference under Section 35-H was maintainable or appeal was maintainable. The Apex Court held that appeal was maintainable since Tribunal has passed the order on 3rd March, 2005. The question which has arisen for consideration in the present appeal was not under consideration in the said case. Now the submission of Sri Kesarwani that right of appeal under Section 35-G of the Act being statutory remedy and a substantive right, should be interpreted liberally while that portion of this section which excludes the right of appeal to the High Court has to be construed strictly and in a restrictive sense is to be considered. There is no dispute that right of appeal is a statutory right given under Sections 35-G and 35-L of the A ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ch relate to a particular manufacturer falls within the jurisdiction of the High Courts." In view of the foregoing discussions, we are of the view that since the question raised in the appeal relates to eligibility of the goods manufactured by the assessee for exemption under Notification No.1/93-C.E. dated 28.2.1993 and goods were manufactured without payment of duty and no assessment had taken place, the proceedings initiated under Section 11-A were for determination of duty liability in which the eligibility of the said goods for exemption was disputed. The question of exemption is directly and proximately related to the rate of duty for the purposes of assessment of excise duty payable by the respondent. The appeal on the said question is clearly excluded under Section 35-G and can be filed by the revenue before the Apex Court under Section 35-L of the Act. Thus the preliminary objection of the respondent regarding maintainability of appeal is upheld and Central Excise Appeal Defective No.- 402 of 2005 is held not maintainable under Section 35-G of the Act. As observed above, in view of the order of the Apex Court dated 27th February, 2006, the Central Excise Reference Appl ..... X X X X Extracts X X X X X X X X Extracts X X X X
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