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2019 (7) TMI 165 - AT - Central ExciseExemption from excise duty - kerosene(SKO) used as interface for pumping diesel/petrol(HSD/MS) - superior kerosene oil (SKO) meant for distribution in PDS - time limitation - Department relies on the circular of 2002 and seeks duty on that part of the SKO, which is used as interface for pumping HSD/MS SKO, as applicable to MS/HSD as the case may be in terms of the CBEC Circular of 2002 - HELD THAT:- The issue is squarely settled by the coordinate bench at Ahmedabad in the case of M/S. INDIAN OIL CORPORATION LIMITED VERSUS COMMISSIONER OF CENTRAL EXCISE & ST, VADODARA [2018 (9) TMI 24 - CESTAT AHMEDABAD]. The ratio was followed by Kolkata Bench in the case of M/S. NUMALIGARH REFINERY LTD. VERSUS COMMR. OF CENTRAL EXCISE, SHILLONG [2019 (6) TMI 496 - CESTAT KOLKATA]. The goods are to be assessed in the form they are cleared from the factory and as the appellants have satisfied the conditions of Notification at the time of removal of goods from factory, duty cannot be demanded from them for subsequent activities, if any, by the purchasers. At best, the department could have a case that certain quantity of SKO is not being used for intended purposes, subsequent to the clearance and that applicable duty on the same has escaped payment, at least as applicable to SKO, if not as applicable to MS/HSD - However, the issue not being the subject matter of the appeals, we refrain from coming to a conclusion on this issue. What has been cleared by the appellants at the factory is undisputedly, SKO for use in PDS system. If some quantity of the SKO is not used for the intended purposes, after clearance, duty cannot be demanded from the appellants. Time Limitation - HELD THAT:- There are sufficient reasons to believe that there could be bona fide belief on the part of the appellants. Therefore, extended period cannot be invoked - The SCN is based on a Circular issued in 2002. SCN is issued in 2014, a clear 12 years later. We find that nothing prevented the department from making suitable enquiries and to issue notice in even time. Moreover, no evidence of suppression of facts etc with intent to evade payment of duty has been placed on record. Therefore, the extended period is not invokable. The appeals survive on merits and limitation - appeal allowed - decided in favor of appellant.
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