TMI Blog2006 (7) TMI 401X X X X Extracts X X X X X X X X Extracts X X X X ..... . A few exports were made after obtaining the respective licences. Barring these few, all exportations had taken place before the corresponding importations. Eventually, in 1995, the Department found that, in violation of condition v(a) of the above Notification, input stage credit had been obtained by the party in respect of the goods manufactured and exported by them in discharge of export obligation under the scheme. On this basis, a show cause notice was issued to the party on 30-10-1995 seeking to deny them the benefit of the Notification and recover duty of nearly Rs. 28.00 lakhs on the imported raw materials under Section 28(1) of the Customs Act. The notice invoked the larger period of limitation under the proviso to Section 28(1) ibid on the basis of alleged wilful mis-statement/suppression of facts by the party. The show cause notice also proposed to hold the above goods to be liable for confiscation under Section 111(o) of the Customs Act as also to impose penalty on the importer under Sections 112(a) and 114(i) of the Act. The proposals in the show-cause notice were contested. The adjudicating authority confirmed the demand of duty (with interest @ 24%) against the part ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... duty on the ground of limitation. According to him, the entire demand raised in the show-cause notice dated 30-10-95 for the period of imports (July - December 1993) was time-barred inasmuch as the larger period of limitation under the proviso to Section 28(1) of the Customs Act was invoked without stating any valid ground. The show-cause notice alleged wilful mis-statement/suppression of facts by the importer . It did not specify as to which facts were wilfully mis-stated or suppressed by the appellants. In order to invoke the proviso to Section 28(1) ibid, it was incumbent on the Department to make specific allegation of facts constituting one or more of the elements [collusion, wilful mis-statement of facts, suppression of facts] mentioned in the said proviso. Otherwise, it would have to be held that the larger period of limitation was invoked without any basis. In this connection, learned counsel relied on the following judgments of the apex Court : (i) Raj Bahadur Narain Singh Sugar Mills Ltd. v. Union of India - 1996 (88) E.L.T. 24 (S.C.) (ii) Collector of Central Excise v. H.M.M. Ltd. - 1995 (76) E.L.T. 497 (S.C.) (iii) Kaur Singh v. Collector of Central E ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... a had not been taken at any earlier stage, it was not entertained by the Court. Shri Arvind P. Datar sought to strike a distinction between his clients case and the case of Bharti Telecom Ltd., by submitting that M/s. R.K.K.R. Steels Ltd. had actually pleaded before the adjudicating authority that it was practically impossible for them to identity the inputs (at the time of receipt in factory)-which would be used in relation to the manufacture of export goods. Counsel added that this plea was not considered by the Commissioner. On account of the above factual distinction between the two cases, counsel argued, the apex Court s decision in Bharti Telecom Ltd. (supra) was not applicable to the appellants case. 5. We have given careful consideration to the submissions. Learned counsel s contention that, as the entire amount of Modvat credit availed in respect of export goods had been reversed long before the deadline (31-1-1997) set by the Central Govt. under the Amnesty Scheme, the scheme was not applicable to them cannot be accepted. A similar plea raised by M/s. Bharti Telecom Ltd. was rejected by the Supreme Court, holding that the Amnesty Scheme recognized the already reversed ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... o the adjudicating authority for licencewise scrutiny of Modvat credit reversals. As, in the appellants case, it is not in dispute that they reversed the entire credit (as per the said formula) before 31-1-97 and did not pay any amount as interest before or after that date, there is no need of a similar remand and a final decision on merits can be rendered at this stage. 6. We are told that the appellants have not paid any amount towards interest till date. Hence, in terms of the Hon ble Supreme Court s judgment in Bharti Telecom (supra) and the decision of this Bench in MRF s case, the appellants must be held to have committed breach of Condition No. V(a) of the above notification and consequently they are not eligible for exemption, under the Notification, from payment of duty on the imported raw materials. Learned senior counsel has made an endeavour to distinguish his client s case from the case of Bharti Telecom Ltd., who were not permitted by the apex Court to raise a new plea before it. We note that, before the adjudicating authority, the appellants had pleaded, through written submissions, that it was practically impossible for them to identify the inputs (at the time of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ingredients [collusion, wilful mis-statement or suppression of facts or contravention of any of the provisions of the Act or of the Rules made thereunder with intent to evade payment of duty] justifying invocation of the larger period of limitation under the proviso to Section 11A(1). Hence the High Court set aside the invocation of extended period of limitation and vacated the demand of duty on the assessee. In the case of H.M.M. Ltd., the Supreme Court was confronted by a similar situation and it was held : If the Department proposes to invoke the proviso to Section 11A(1), the show-cause notice must put the assessee to notice which of the various commissions or omissions stated in the proviso is committed to extend the period from six months to 5 years. Unless the assessee is put to notice, the assessee would have no opportunity to meet the case of the department. The defaults enumerated in the proviso to the said sub-section are more than one and if the excise department places reliance on the proviso it must be specifically stated in the show cause notice which is the allegation against the assessee falling within the four corners of the said proviso. The above ruling wa ..... X X X X Extracts X X X X X X X X Extracts X X X X
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