Practice of assessment to be followed in case of disputes relating to issues involved in Department's Review Petition against the Supreme Court's decision dated 20-12-1986 in the MRF case - Central Excise - 15/2/87-CX.1

Practice of assessment to be followed in case of disputes relating to issues involved in Department's Review Petition against the Supreme Court's decision dated 20-12-1986 in the MRF case F. No. 15/2/87-CX.1 Dated 29-6-1989 Government of India Ministry of Finance (Department of Revenue) New Delhi Subject : Practice of assessment to be followed in case of disputes relating to issues involved in Department's Review Petition against the Supreme Court's decision dated 20-12-1986 in the MRF case. I am directed to refer to this Ministry's telex of even number dated the 16th May, 1989 on the above subject in which all Collectors were informed that the Hon'ble Supreme Court in their order dated 1-5-1989 has recalled the M.R.F. decision dated 20-12-1986 and directed that the cases be heard again on merits. Inasmuch as the cases are being reopened, the Judges also refrained from expressing any opinion at this stage on the points raised in the Review Petition. The issues raised in the M.R.F. case are thus still sub-judice and a final decision is to be rendered after fresh hearing by the Supreme Court. 2. As the Collectors are already aware after the Hon'ble Supreme Court delivered the judgment in the M.R.F. case, on the issues namely (i) interest on finished goods as stocks from the date of a payment of duty till the date of sale from the depots, (ii) interest on receivable; (iii) cost of distribution incurred at the duty paid depot and certain other issues, the Government had not accepted the said judgment, particularly those decisions which were not favourable to the stand taken by the Department that these elements are includible in the value as per Sec. 4 and had therefore agitated against the decisions given by the Hon'ble Supreme Court through the Review Petition. 3. Now that the Supreme Court has recalled their earlier judgment dated 20-12-1986 in the MRF case, the assessments, if any which have been finalised already on the basis of decision, dated 20-12-1986 of the Supreme Court in the MRF case, have to be re-opened and kept pending by resorting to provisional assessments or by issue of show cause notices/demands. This is so because the issues are still subjudice in the Supreme Court and the decision dated 20-12-1986 in the MRF case has been if they are not raised till a final decision by the Supreme Court. If any deduction have been allowed in determining value on the basis of the said judgment, steps may be taken immediately to reassess and raise demands accordingly keeping in view the time limitation as provided in Section 11A of the Central Excise Act, in so far as the past assessments which might have been finalised already, are concerned and keep the issues pending till the final decision of the Supreme Court in the matter. 4. Assessments which are being made on provisional basis in respect of the issues similar to these involved in the MRF case after filing the Review Petition by the Department, may continue on provisional basis till the Supreme Court renders final decision on the issues contested by the Department in the MRF case. 5. Assessments which have been made or are being made on the basis of the Supreme Court decision in the case of Bombay Tyre International v. Union of India may not be disturbed.