TMI Blog2007 (8) TMI 728X X X X Extracts X X X X X X X X Extracts X X X X ..... material facts by the Respondents and therefore the case of the Appellant does fall under the proviso of S.11A(1) of Central Excise Act? The relevant proviso to Section 11A reads as under:- Provided that where any duty of excise has not been levied or paid or has been short-levied or short-paid or erroneously refunded by reason of fraud, collusion or any wilful mis-statement or suppression of facts, or contravention of any of the provisions of this Act or of the rules made thereunder with intent to evade payment of duty, by such person or his agent, the provision of this sub-section shall have effect, as if for the words one year, the words five years were substituted. 2. To answer the question, a few facts may be set out. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... have not taken steps against the same. The Air Freshners cleared by the respondents were having in addition to the printed name of respondent No.1, printed names of other companies, as an illustration of M/s.Cachet Pharmaceuticals Ltd. In addition to words and logos, the aerosol containers were also having a slogan printed not for sale . The statement of respondent No.3 had been recorded. Additional Commissioner, Central Excise, Thane held against the respondents. The order recorded that there was sufficient material to invoke the first proviso to sub-section (1) of Section 11A of the Act and in view of that, were liable to pay interest at appropriate rate under the provisions of Section 11AB and also mandatory liable for the penalty to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... contention urged that the Respondent No.1 established in the Grampanchayat area, did not proceed to answer the issue but held that the show cause notice could not have been issued on the ground of limitation as the respondents had made out a strong case of bonafide belief on their part and accordingly allowed the Appeal and set aside the order of the Authorities below. The Tribunal also noted the judgment of the Supreme Court in Commissioner of Central Excise, Trichy vs. Grasim Industries Ltd. 2005 (183) E.L.T. 123 (S.C.). 6. The issue now can be answered in the context of the questions of law framed, which is restricted to the findings of the Appellate Tribunal that the Respondents could not have invoked the proviso to Section 11-A of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... gment in the case of Astra Pharmaceuticals (P) Ltd. V. Collector of Central Excise, Chandigarh 1995 (75) E.L.T. 214 (S.C.) the Supreme Court also noted that the Tribunal had followed its earlier judgments, reference to which is made in para.2 of the judgment. After reversing the judgment of the Tribunal in the matter of penalty which is imposed the Supreme Court observed as under:- While the conclusions of the Commissioner that the Respondents were not entitled to the benefit of the Notification are correct, the fact still remains that the Tribunal has in a number of matters given an interpretation as understood by the Respondent. It therefore cannot be said that the Respondents could not have taken the view they did. It cannot be said ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cs Pvt. Ltd. vs. Commissioner of Central Excise, Indore, 2005 (188) E.L.T.3(S.C.) the issue involved was the application of notification dated 28th February, 1993. From a consideration of the judgments and the ratios of the judgments it would be clear that in case where the Tribunal had given an interpretation as understood by the Respondents. The law on the subject was not clear. In such circumstances unless the predicates of the proviso to Section 11A are satisfied, Section 11A cannot be invoked to levy penalty nor could the extended period of limitation as provided under the proviso be applied. 9. As noted by us earlier the application of the proviso would require that the non-payment of excise duty had to be by reason of fraud, co ..... X X X X Extracts X X X X X X X X Extracts X X X X
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