TMI Blog2023 (8) TMI 791X X X X Extracts X X X X X X X X Extracts X X X X ..... also agreed upon that the longer period of limitation under proviso to Section 11A(1) cannot be invoked nor can the department invoke penalty under Section 11AC, when there is a doubt as to whether the items being supplied by the assessee to KEL are semi-finished or fully finished products. This is because, if such a doubt exists, then the assessee cannot be accused of committing any fraud, collusion or making any willful misstatement or suppression of facts or can it be accused of contravention of any of the provisions of this Act, in which situations only the extended period of limitation can be applied - When there is no intention to evade payment of duty by the assessee because of a doubt entertained by the assessee, the extended pe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rejected the plea of the assessee that they were not liable to pay Central Excise duty on the said product. The appeal to the CESTAT by the assesee 6) In the appeal before the CESTAT, the assessee, however, contended that the machine rotors, which he prepares for KEL has to be subjected to further process before being used as parts of electrical fans manufactured by KEL as finished products; and these items sent back to KEL by it are not fully finished parts of the fans, that they are not marketable; and so no Central Excise duty can be charged thereon. It was also contended that the Department cannot invoke the extended period of limitation under the proviso to Section 11A(1) of the Act and impose duty or penalty. The order of the Tribu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s undertaken by the assessee is resulting in emergence of marketable and hence, excisable goods, the duty demand is confirmed. The same can be demanded only for normal limitation period and no penalty under Section 11AC would be imposable. The instant Appeal 11) Challenging the same, this appeal is preferred by the Department. 12) The questions to be considered are: (a) whether in the facts and circumstances of the case, the Tribunal was right in remanding the matter to the Original Adjudicating Authority? ; and (b) whether its observation that the longer period of limitation under proviso to Section 11A(1) could not be invoked by the Department as also whether the penalty under Section 11AC could not be imposed or not, i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e assessee to KEL are semi-finished or fully finished products. 19) This is because, if such a doubt exists, then the assessee cannot be accused of committing any fraud, collusion or making any willful misstatement or suppression of facts or can it be accused of contravention of any of the provisions of this Act, in which situations only the extended period of limitation can be applied. 20) When there is no intention to evade payment of duty by the assessee because of a doubt entertained by the assessee, the extended period of limitation under the proviso to Section 11A(1) cannot be invoked. 21) Therefore, we do not find any merit in the appeal and the same is accordingly dismissed. Pending application(s), if any, stands disposed o ..... X X X X Extracts X X X X X X X X Extracts X X X X
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