TMI Blog2006 (7) TMI 458X X X X Extracts X X X X X X X X Extracts X X X X ..... -8-2005 was pleased to remanded the matter back, to consider the question of limitation. The said decision of the Supreme Court is reported in 2005 (186) E.L.T. 529 (S.C.) = 2005 (69) RLT 663 (Commissioner of Central Excise, Bhubneshwar-II v. IFGL Refactories Ltd.) 2. The brief facts relevant for deciding this issue relating to limitation are:- (a) The appellant manufactures Continuous Casting Refractories. The subject matter of the instant appeal relates to Refractories sold by the Appellant to M/s. Visakhapatnam Steel Plant (in short VSP) during the period from September 1993 to December 1995. The said Refactories were sold pursuant to four Purchase Orders dated 9-9-1993, 11-7-1994, 24-2-1995 and 16-5-1995. All the said supplies were under Duty Exemption Scheme contained in Chapter VII of the Export and Import Policy 1992-97 (in short the Import Policy) and were made in discharge of the export obligation cast upon the Appellant under Advance Intermediate Licences (in short AILs) issued to it. The said AILs were issued to the Appellant against surrender of Advance Licences (in short ALs) issued to VSP. (b) A Show Cause Notice dated 21-1-1997 was issued alleging that ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ifically stated that the supplies to VSP will commence on receipt of Advance Intermediate Licence. (II) Letter dated 18-10-1993 to the Assistant Collector of Central Excise and Customs, Rourkela: In this letter it was specifically stated that the said Refactories will be supplied to VSP on deemed export basis by utilizing the VSP s Advance Licences under deemed export category. It was also stated that the Appellant has applied before the licensing authorities to issue Advance Intermediate Licence to the Appellant under the coverage of certificate and Advance Licence of VSP. (III) 18-10-1993 - Reply of the Assistant Collector to the Appellant s letter dated 29-9-1993 mentioned above. (IV) Letter dated 19-10-1993 to the Collector of Central Excise and Customs, Bhubneshwar: Along with these letter copies of letters dated 29-9-1993 and 18-10-1993 addressed to the Assistant Collector were forwarded to the Collector. In this letter it was specifically stated that the duty free Advance Intermediate Licences would be issued to the Appellant by the DGFT on the basis of Advance Licences issued in favour of VSP and that the said supplies will be on deemed export basis. (V) Lette ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Advance Intermediate Licences issued to the Appellant were also clearly mentioned. In both these documents it was clearly stated that AILs have been issued to the Appellant against ALs surrendered by VSP. In the Invoices, it was clearly mentioned that the supplies were under Deemed Export Category (Copies of the said Invoices by way of specimen). (X) All the goods in question were cleared from the appellant s factory under cover of proper Central Excise Invoices, on payment of Central Excise duty as well as Central Sales Tax. Copies of Invoices, which were the duty paying documents, were regularly filed with the Department along with monthly RT-12 Returns. Invoice-wise details of such payments of Central Excise Duties and Central Sales Tax have been given in the statements. (XI) For lodging claims under Para 122(c) of the Import Policy, the Appellant was regularly applying before and obtaining from the Central Excise Authorities monthly certificates as regards total payment of Central Excise duty during the month on the supplies made to VSP under Deemed Export Category, copies of some such certificates duly signed by the Inspector of Central Excise and the Superintendent o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tire facts were fully and truly disclosed by the Appellant to the Central Excise Authorities. There is no fraud or collusion or misstatement wilful otherwise, or suppression of facts or contravention of any of the provisions of law on part of Appellants. Therefore none of the conditions precedent for invoking the longer period of limitation of 5 years laid down in the proviso to Section 11A(1) of the Central Excise Act, 1944 (in short the 1944 Act) exist or was satisfied in the present case. (c) In the impugned Order the Appellant s submissions as regards limitation have been rejected at internal page 7 of the order by the Commissioner holding :- (i) For the period up to March 1994 he held that the assessment were provisionally made and were then finalized on 30-10-1996. (ii) For the period from April 1994 to March 1995 the Commissioner has held that additional consideration was not disclosed in the Invoices and it was declared that there was no additional consideration. The first reason, supra, arrived by the Commissioner, that the assessments for the period up to March 1994 were provisional and that these were finalized on 30-10-1996 is factually incorrect and contr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... unal, because ultimately the Supreme Court took a different view, no deliberate suppression or misstatement could be arrived on part of the Appellants to warrant invocation of the longer period of limitation for demand of duty. The reliance on the following decision is well placed :- (i) 2005 (188) E.L.T. 251 (Gopal Zarda Udyog v. CCE) - In this judgment, in paragraphs 12 and 14 the Hon ble Supreme Court was pleased to hold that suppression of facts is not a failure to disclose legal consequences of a certain provisions. The said Paragraphs 12 and 14 are reproduced below :- 12. In the case of Padmini Products v. Collector of Central Excise reported in 1989 (43) E.L.T. 195, this Court held that in a given case where there is a scope for believing that the goods were not excisable and consequently no licence was required to be taken then the extended period of limitation was inapplicable. Mere failure or negligence on the part of the manufacturer either not to take out the licence or not to pay duty in cases where there is a scope for doubt does not attract the extended period of limitation. Unless there is evidence that the manufacturer knew that the goods were liable to du ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Tariff Item No. 48.18. Thus, all necessary material was available to the Department. There is no new material which has been discovered by the Department. In these circumstances, in our view the adjudicating order as well as the order or CEGAT holding that the extended period is available cannot be sustained and are hereby set aside. (iii) 2005 (188) E.L.T. 146 (Anand Nishikawa Co. Ltd. v. CCE) - In this judgment in paragraphs 27 and 29 the Hon ble Supreme Court held as under :- 27. Relying on the aforesaid observations of this Court in the case of Pushpam Pharmaceutical Co. v. Collector of Central Excise, Bombay [1995 Suppl. (3) SCC 462] we find that suppression of facts can have only one meaning that the correct information was not disclosed deliberately to evade payment of duty, when facts were known to both the parties the omission by one to do what he might have done, not that he must have done would not render it suppression. It is settled law that mere failure to declare does not amount to wilful suppression. There must be some positive act from the side of the assessee to find wilful suppression. Therefore, in view of our findings made herein above that there was ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... usly refunded, it can be recovered by the appropriate officer within six months from the relevant date. (The expression relevant date is defined in the section itself. But the said period of six months gets extended to five year where such non-levy, short levy etc. is by reason of fraud, collusion or any wilful misstatement or suppression of facts or contravention of any of the provisions of this Act or of the rules with intent to evade payment of duty.... 6. Now so far as fraud and collusion are concerned, it is evident that the requisite intent, i.e., intent to evade duty is built into these very words. So far as misstatements or suppression of facts are concerned they are clearly qualified by the word wilful preceding the words misstatement or suppression of facts which means with intent to evade duty. The Next set of words contravention of any of the provisions of this Act or Rules are again qualified by the immediately following words with intent to evade payment of duty . It is, therefore, not correct to say that there can be a suppression or misstatement of fact, which is not wilful an yet constitutes a permissible ground for the purpose of the proviso to Secti ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... is attracted the duty etc. can be claimed even after expiry of one year for an extended period of five years from the date of the demand. To invoke the proviso three requirements have to be satisfied, namely (1) that any duty of excise has not been levied or paid or has been short-levied or short-paid or erroneously refunded; (2) that such a short-levy or short-payment or erroneous refund is by reason of fraud, collusion or wilful misstatement or suppression of facts or contravention of any provisions of the Central Excise Act or the rules made thereunder; and (3) that the same has been done with intent to evade payment of duty by such person or agent. These requirements are cumulative and not alternative. To make out a case under the proviso, all the three essentials must exist. (viii) 2000 (115) E.L.T. 35 (National Radio Electronics Co. Ltd. v. CCE) : Demand - Limitation - Charges for maintenance services of computers during warranty period collected by assessee - Contracts for the sales of the computers disclosed to department that assessee entitle to collect such charges - No suppression - Larger period of limitation not invocable - Appeal allowed - Section 11A of Cen ..... X X X X Extracts X X X X X X X X Extracts X X X X
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