2010 (10) TMI 448 - HC - Central Excise

Demand - Limitation - Suppressed the facts - SSI -The appellant was manufacturing animal feed supplements and has also started manufacturing Ayurvedic medicines in the name of Caton Catcough and Utcrolon - but under the bona fide belief the said items have not been disclosed - No document has been adduced to establish that at any point of time the appellant has disclosed to the Department that they were manufacturing Ayurvedic medicines - Thus it is a case where appellant has suppressed the facts of manufacturing of Ayurvedic medicines. Held that do not find any error in the order of the Tribunal in confirming the order of the adjudicating authority invoking the proviso to Section 11A of the Act - Accordingly the appeal fails and is dismissed - Decided against of assesee.

Summary

Issues:
Challenge to Tribunal's order, Invocation of extended period of limitation, Eligibility for S.S.I. exemption, Suppression of facts regarding manufacturing of Ayurvedic medicines, Correct classification of goods.

Challenge to Tribunal's Order:
The petitioner filed a writ petition challenging the Tribunal's order dated 29-9-2003. Subsequently, an appeal under Section 35G of the Central Excise Act was filed against the same order. The petitioner, having filed an appeal against the Tribunal's order, did not press the writ petition, leading to its dismissal. The request to dispense with the requirement of filing a certified copy of the Tribunal's order in appeal was accepted.

Invocation of Extended Period of Limitation:
The adjudicating authority issued show-cause notices invoking the proviso to Section 11A of the Act, raising the demand of Excise Duty on Ayurvedic medicines. The appellant, claiming S.S.I. Unit status, contended that the proviso to Section 11-A was not applicable. However, the authority confirmed the demand citing suppression of facts regarding the manufacturing of Ayurvedic medicines, leading to the invocation of the extended period of limitation.

Eligibility for S.S.I. Exemption:
The appellant's claim for exemption as an S.S.I. Unit was rejected due to the use of a brand name belonging to another entity. The Tribunal remanded the matter back to the adjudicating authority to re-examine the eligibility for the S.S.I. exemption.

Suppression of Facts Regarding Manufacturing of Ayurvedic Medicines:
The Tribunal found that the appellant had not disclosed to the Department that they were manufacturing Ayurvedic medicines, leading to the invocation of the extended period of limitation. The appellant's argument that there was no suppression of facts was rejected, as no evidence was presented to establish that the manufacturing of Ayurvedic medicines was disclosed to the Department.

Correct Classification of Goods:
The Tribunal confirmed the classification of goods as Ayurvedic Veterinary Medicaments under specific sub-headings for relevant periods. No dispute was raised regarding the classification in the appeal. The Tribunal's decision on the classification was upheld.

In conclusion, the High Court upheld the Tribunal's order, finding no error in confirming the invocation of the extended period of limitation due to the suppression of facts by the appellant. The appeal and writ petition were both dismissed, affirming the decision of the adjudicating authority and the Tribunal on the issues raised.