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2019 (11) TMI 673 - SC - Central ExciseScope of SCN - Manufacturing activity taking place or not - Respondent manufactured Foots Oil, Pressed Wax, Pressed Paraffin Wax without observing the mandatory procedure and clearing Excise Duty - demand of Central Excise duty under the extended proviso to Section 11A of the said Act - interest under Section 11 AB of the said Act - recovery of duty - scope of SCN. HELD THAT:- Section 11A deals with various facets including non-levy and non-payment of excise duty and contemplates issuance of a show cause notice by the Central Excise Officer requiring the “person chargeable with duty” to show cause why “he should not pay the amount specified in the notice.” In terms of sub-section 10 of said Section 11A, the concerned person has to be afforded opportunity of being heard and after considering his representation, if any, the amount of duty of excise due from such person has to be determined by the Central Excise Officer. If the process or activity undertaken does not amount to manufacture or if no duty is payable for any reason including the benefit under any scheme of exemption holding the field, it shall always be open to the concerned person to project such view point while making any representation in response to the show cause notice - the scheme of Section 11A does not contemplate that before issuance of any show cause notice, there must, prima facie, be: (a) a preliminary determination that the process or activity undertaken in the matter amounts to manufacture; and (b) before arriving at such preliminary determination, any hearing to the concerned person is contemplated. In the present case, the respondent had not registered itself and was not paying any excise duty on the products that it was manufacturing. The search conducted by the Department at the registered office and the factory premises of the respondent led to the recovery of certain material on the basis of which the Department was considering the matter - the provisions of the Act do not contemplate any such prima facie determination to be arrived at and requiring that a copy of such determination to be submitted to the concerned person and only thereafter to proceed in the matter. Since the provisions of the Act do not contemplate any prima facie determination which must be communicated to the concerned person, the Department was justified in not communicating the Internal Order on its own. The matter was correctly assessed by the High Court on the next occasion when in spite of having directed that a copy of the Internal Order be supplied, it acknowledged that the remedy of the respondent lied in submitting reply to the show cause notice, in which reply it would be open to the respondent to take objections to the jurisdiction of the appellant to proceed against the respondent under the provisions of the Act. Scope of SCN - HELD THAT:- In the present case, there was no assessment and computation of any duty element. The matter had not gone beyond the Show Cause Notice. The questions in the matter pertained to the correctness of the view whether there was any adjudication in the matter and whether the appeal at the instance of the Respondent was maintainable. Appeal allowed - decided in favor of appellant.
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