TMI Blog1990 (9) TMI 189X X X X Extracts X X X X X X X X Extracts X X X X ..... of the Notification No. 119/66 dated 16-7-1966 would not be available to them and they would be liable to pay duty. The Central Board of Excise Customs has upheld the findings of the Collector of Central Excise, Hyderabad, that the Notification No. 119/66 was not applicable to their products, and since the Classification List was not approved, the clearances without payment of duty were to be charged to duty. The penalty of Rs. 10 lakhs was reduced to Rs. 5 lakhs. The appeal is against this order. 3. Shri N. K. Dev, ld. Consultant, traced the facts of the case to the classification list dated 2-11-1974, item 2 was approved until further orders and the Notification No. 119/66 was applicable to their products. However, the Show Cause Notice dated 19-10-1976 and 18-1-1977 was issued to the appellant for removing Bronze Ingots and Copper Ingots without payment of duty and without approval of classification list. But, however, Shri N. K. Dev pointed out that the classification list was approved and the endorsement made as approved until further orders is a routine endorsement made on all the classification lists and the fact that RT-12 Returns were assessed under nil rates of dut ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... -1976 has been first issued on the ground that the appellants have produced slabs and rounds by melting the non-ferrous scrap such as bronze, lead, copper alloy 90/10, 85/15, aluminium scrap, on which the duty of central excise has been paid and cleared a quantity of 2,23,430 Kgs. of Bronze Ingots and 16,670 Kgs. of copper ingots till the end of June 1976 without payment of central excise duty while the exemption under Notification No. 119/66 dated 16-7-1966 and amended, is only for the ingots, slabs and rounds manufactured out of the scrap and virgin copper or copper alloys as specified in the notification and duty payable has been worked out to Rs. 9,69,402.60. A second show cause notice was issued on 18-1-1977 refers to the Classification List dated 2-11-1974/27-12-1974 which did not include the Bronze Ingots (copper alloys) and the Classification List in respect of S. No. 2, item 4 was not approved and had failed to furnish in the classification list the manufacture of copper ingots and copper alloys, and duty has been demanded under Rule 9(2) of the Central Excise Rules. 6. The issue now to be decided is whether there was any clandestine removal. The show cause notice dated ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eady been paid; or Tariff Act, 1934 (32 of 1934), has already been paid or; (iv) copper or copper alloys in any crude form purchased from the market on or after the 20th day of August, 1966 [clause (iv)] is deemed to have been inserted with effect from the 20th day of August, 1986." It is the finding of the department that the conditions for availing the notification were not followed and hence not applicable. It is the contention of the appellant that as per the ISI specifications, bronze ingots is expected to contain 80% copper with other metals added up to conform to the required metallurgical standards and that there can be no manufacture of alloys without the addition of a few of the additions like lead, tin (solder) etc. along with scrap. It was up to the appellants to have satisfied the Revenue that they have used the required items for claiming the exemption under the notification. In having cleared the goods without obtaining the department s clear approval for the exemption, they are liable to pay the duty. The question whether Rule 10 or 10A will apply is to be resolved. The case laws cited connote that Rule 10A will not apply as it is a residuary rule, and the Rule ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... .L.T. (J 399) has in paras 18 and 23 given a clear and decisive view. The paras are reproduced below :- Para 18 : This now takes us to the question of proper interpretation to be placed on the expression Short-levied and paid in Rule 10. Does the expression short-levied mean that some amount should have been levied as duty as contended by Dr. Syed Mohammad or will that expression cover even cases where the assessment is of nil duty as contended by Mr. Daphtary? What is the meaning of the word paid in Rule 10? It is contended on behalf of the appellants that it means actually paid , whereas, according to the respondents, it means ought to have been paid . Taken literally the word paid does actually mean paid in cash. That means that a party or an assessee must have paid some amount of duty whatever may be the quantum. If this literal interpretation is placed on the expression paid in R.10, it is needless to state that it will support in a large measure the contention of Dr. Syed Mohammad that R. 10, contemplates a short-levy in the sense that the amount which falls short of the correct amount has been assessed and actually paid. In our opinion, the expression pai ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 10 it is not necessary that some amount of duty should have been actually paid. That provision will apply even to cases where there has been a nil assessment in which case the entire duty later on assessed must be considered to be the duty originally short-levied. There is also no difficulty in calculating the period of three months. As pointed out above, the Act and the Rules provide very elaborately the stage and the time when the duty is to be paid and if that is so, that must be considered to be the stage or time when the duty ought to have been paid and if so the period of three months will run from the time when the duty ought to have been paid." On the basis of the above ratio, it can be stated that the expression paid in Rule 10 can reasonably be read as ought to have been paid and the demands are liable to be issued within three months from the date on which duty or charge was paid and to overcome that difficulty in calculating the three months period, the Supreme Court has held that stage or time when the duty ought to have been paid should be taken as the three months which will run from the time when the duty ought to have been paid. 9. Therefore, the appellant ..... X X X X Extracts X X X X X X X X Extracts X X X X
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