TMI Blog2023 (3) TMI 1067X X X X Extracts X X X X X X X X Extracts X X X X ..... er section 11A within the normal period of limitation. Therefore, even if no audit is conducted during the relevant period and some duty escapes assessment, extended period of limitation cannot be invoked for that reason. The check against incorrect self assessment is the scrutiny of the return by the officer and audit is only the second check. Therefore, while the fact that audit checks only some selected documents and not every document as held in the impugned order is correct, this cannot be a ground to invoke extended period of limitation. Unlike audit, the officer receiving the ER-1 returns is required to scrutinise the returns and is empowered to call for any information. While the assessee was required to self assess duty and file ER-1 return, a check against such self- assessment was the scrutiny which the officers were mandated to do by Rules. Audit is the next level of check against the scrutiny. If the audit points out some wrong assessment which was not pointed out by the officer scrutinising the ER-1 return, the fault lies at the doorstep of the officer. It does not, by itself, establish that the assessee had suppressed any facts. In this case, not only one but sev ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t invokable in the facts and circumstances of this case. However, since the entire matter is being remanded back, we expect that the learned adjudicating authority will examine the issue of limitation also in detail keeping in mind the facts narrated in para 7 above. 15. In view of the entire above discussions, the appeal in hand is allowed by way of remand as explained in the preceding paragraphs. 2. The impugned order was passed dropping the demand of Rs.3,47,13,776/- and confirming the demand of Rs. 49,27,427/-. He also imposed penalty of Rs. 49,27,427/- under Section 11AC. Learned counsel for the appellant submits that the Commissioner correctly calculated the demand of duty on merits based on the facts presented before him and as per the judgment of the Supreme Court regarding taxability of the cement supplied to institutional buyers. 3. However, he contested the demand as the Show Cause Notice was issued beyond the normal period of limitation. He also contested the imposition of penalty under section 11AC. It is undisputed that to invoke extended period of limitation and also to impose penalty under section 11AC, one of the following elements must be present: a) ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... o show that they had provided any information about the categories of buyers to whom they had cleared the cement in ER-1 and they have also deliberately misinterpret the definition of institutional/industrial consumer‟ of SoWM (PC) Rules as well as provision of notification No. 4/2007-CE dated 01.03.2007 as amended. As regards the conduct of Audit of records of the Noticee, I find that EA-2000 Audit is always a selective audit and not 100% audit of records of the assessee. In such circumstances, it is settled position that the assesse has to prove on record that the issue raised in the Show Cause Notice was in the knowledge of Auditors and they had cleared it after due examination. However, no such evidence had been placed on record by the Noticee. Hence it appears that mere conduct of audit would not have effect on invocation of extended period. After having made short-payment of duty on cement over a prolonged period as evident from Show Cause Notice, in the era of self assessment, the Noticee cannot be permitted to take shelter of a spacious plea relating to matter being time barred. Hence, with due respect to observations of Hon'ble CESTAT, I find that extended ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... from the factory or the warehouse during a month shall be paid by the 6th day of the following month, if the duty is paid electronically through internet banking and by the 5th day of the following month, in any other case: Provided that in case of goods removed during the month of March, the duty shall be paid by the 31st day of March: Xxxxxx Rule 12 Filing of return.- (1) Every assessee shall submit to the Superintendent of Central Excise a monthly return in the form specified by notification by the Board, of production and removal of goods and other relevant particulars, within ten days after the close of the month to which the return relates Xxxxxxx (3) The proper officer may on the basis of information contained in the return filed by the assessee under subrule (1), and after such further enquiry as he may consider necessary, scrutinize the correctness of the duty assessed by the assessee on the goods removed, in the manner to e prescribed by the Board. (4) Every assessee shall make available to the proper officer all the documents and records for verification as and when required by such officer. xxxxxx 10. The officer scrutinising the returns ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ation. 13. It is also significant in this case that the appellant was issued SCN on the same issue for an earlier period. Thus, the officer scrutinising the returns must have been fully aware of what were the potential disputes and could have examined the ER-I returns and issued the SCNs within time. 14. Equally important is the fact that the issue involved interpretation of the notification and therefore, the appellant could have legitimately held a different view from the Revenue and therefore, no intent to evade payment of duty can be attributed to the appellant. 15. Further, we also find that several rounds of audit were conducted during the period. 16. To sum up, while the assessee was required to self assess duty and file ER-1 return, a check against such self- assessment was the scrutiny which the officers were mandated to do by Rules. Audit is the next level of check against the scrutiny. If the audit points out some wrong assessment which was not pointed out by the officer scrutinising the ER-1 return, the fault lies at the doorstep of the officer. It does not, by itself, establish that the assessee had suppressed any facts. In this case, not only one but sev ..... X X X X Extracts X X X X X X X X Extracts X X X X
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