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M/s Ganpati Rolling Mills Pvt. Ltd. Versus CCE, Delhi-II

2018 (2) TMI 8 - CESTAT NEW DELHI

Validity of SCN - Time limitation - Held that: - the SCN was issued by the department on 19.8.2011. It is an admitted fact on record that the show cause notice has not been issued in this case within the normal period of one year provided under Section 11A of the CEA, 1944. Since, between the period of conducting such audit in August, 2008 and issuance of the show cause notice in August, 2011, the department has not gathered any additional information for initiation of the show cause proceedings .....

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This appeal is directed against the impugned order dated 11.1.2013 passed by the Commissioner (Appeals), Central Excise, New Delhi. 2. The brief facts of the case are that the appellant is engaged in the manufacture of copper wires falling under Chapter Heading 7408 of the Central Excise Tariff Act, 1985. Audit of records of the appellant was conducted for the period July 2007 to March 2008 by the Central Excise department. During the course of audit, it revealed that the finished goods/raw mat .....

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the appellant. The ld. Commissioner (Appeals) vide the impugned order has upheld the adjudged demand. Hence, the present appeal is before the Tribunal. 3. The ld. Advocate appearing for the appellant, at the outset, submits that the proceedings initiated by the department are barred by limitation of time inasmuch as the facts of availability of excess stock in the factory of the appellant was known to the Audit Wing of the department on 20.8.2008 and since the show cause notice was issued on 19. .....

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lity of the goods in the factory were suppressed by the appellant and the same were detected by the Audit Wing on 20.8.2008, issuance of show cause notice within five years from the date of such knowledge should be considered as the relevant period for the issuance of the show cause notice. Thus, he submits that the initiation of show cause proceedings by the department is not barred by limitation of time. 5. Heard both sides and perused the records. 6. I find from the available records that bas .....

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department has not gathered any additional information for initiation of the show cause proceedings, it cannot be said that the show cause notice issued in August 2011, is sustainable on the ground of limitation. I find that in context with the limitation aspect, the Hon ble Allahabad High Court in the case of Triveni Engineering & Industries Ltd. (supra) held that the show cause notice issued after a gap of 22 months after an audit was conducted, is clearly barred by limitation of time. Th .....

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o the notice of the department when the audit was conducted in the month of March, 2010. 6. In the light of the aforesaid, mere suppression of facts without there being a deliberate act of fraud, etc. with the intention to evade payment of duty cannot entitle the department to invoke the proviso to Section 11A of the Act. 7. In Pahwa Chemicals Private Limited v. Commissioner of C. Ex., Delhi, 2005 (189) E.L.T. 257 (S.C.) the Supreme Court held that : It is settled law that mere failure to declar .....

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the Department to immediately take up the contention that the benefit of the Notification was lost. 8. Similarly in Commissioner of C.Ex. Mumbai-IV v. Damnet Chemicals Pvt. Ltd., 2007 (216) E.L.T. 3 (S.C.) the Supreme Court held : In the circumstances, we find it difficult to hold that there has been conscious or deliberate withholding of information by the assessee. There has been no willful misstatement much less any deliberate and wilful suppression of facts. It is settled law that in order .....

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