TMI Blog1976 (11) TMI 68X X X X Extracts X X X X X X X X Extracts X X X X ..... ay. The Proper Officer, Central Excise, permitted the petitioner to take proforma credit of the duty paid on these consignments. After conversion of the ingots received under these consignments, the properzi rods were supplied to Messrs Lallu Bhai Amichand. The assessments of duty on properzi rods so manufactured were completed in 1970. In these assessments, the proforma credit of duty taken by the petitioner under Rule 56-A was not disputed. Nearly four years thereafter, the Collector of Central Excise, Nagpur issued on 15th February, 1974, twelve show cause notices to the petitioner in which it was stated that the proforma credit of duty taken by the petitioner in respect of the aforesaid 12 consignments of ingots was inadmissible. The Petitioner was required to show cause why a penalty under sub-rule (4) of Rule 56-A be not imposed and why the unauthorised inadmissible proforma credit amounting in all to Rs. 1,24,144.45 be not recovered from the petitioner. The petitioner replied to the show cause notices. The Collector by 12 orders passed on 8th July, 1975 imposed penalty to the clue of Rs. 24,000/- (Rs. 2000/- in each case). The Collector further disallowed the proforma credit ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ued by the supplier indicating the particulars of the original gate pass and/or the factory that he has applied for a certificate. In such cases proforma credit of duty may not be allowed until and unless gate pass G.P.1. or the certificate is produced. If the gate pass G.P. 1 or the certificate is not produced within one month of the receipt of the goods by such manufacturer, grant of proforma credit may be refused by the Superintendent having jurisdiction over such manufacturer after giving him an opportunity to explain the delay." 4. A perusal of the impugned orders passed by the Collector goes to show that he was of opinion that it was obligatory on the petitioner in the circumstances of the case to produce a certificate of the jurisdictional Superintendent of Central Excise, Bombay under sub-rule (3) (1) (b) for entitlement of the proforma credit and that no other evidence to prove payment of duty could have been entertained under that sub-rule. The Collector was further of opinion that as the petitioner had not produced before the proper officer at the time when it was permitted to take proforma credit in respect of the twelve consignments the documents referred to in sub-r ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... alco on the ingots was subsequently verified. It is plain from the language of the provision that it has no application on the facts of the instant case where the allegation is that the petitioner was wrongly allowed proforma credit by the proper officer because the petitioner had not complied with sub-rule (3) (i) (b). It may be here mentioned that by a notification dated 14th August, 1976, Rule 56-A has been amended and sub-rule (5) (i) has been added to meet such a situation. Sub-rule (5) (i), however, was not there when the Collector passed the impugned orders. The Collector relied solely on the second proviso to sub-rule (2). In the return as also in arguments, no other provision of law has been pointed out to support the recovery of the amount taken as proforma credit. In our opinion, as the second proviso does not authorise Collector to order recovery of this amount, his order to that extent is plainly in excess of jurisdiction. It is not necessary to pursue this matter any further as Palshikar, who appeared for the respondents, plainly conceded that the Collector's order in this respect was in excess of authority. 6. It was also contended by the learned Counsel for the pe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... was satisfied that the duty on the ingots had been paid and, therefore, the petitioner was allowed credit of that duty. That proper officer did not call for the documents mentioned in the sub-rule nor did he take any objection on that score. Had any objection been taken at that stage, the petitioner would have been able to produce the necessary certificates from the officer having jurisdiction over Messrs Lallu Bhai Amichand or Messrs Metal Rolling Works. Even at the time of making assessments which were all completed in 1970 under Rule 173-I no objection was taken by the assessing officer regarding any illegality or irregularity in taking proforma credit. The impugned notices in this case taking the objection regarding the non-compliance of sub-rule (3)(i)(b) were issued in February, 1974, after a lapse of four years. it is clear that there was no fraud, collusion, or evasion of payment of duty. Even if it be held that the requirement of producing the specific documents referred to in sub-rule (3)(i)(b) is mandatory, the omission in that matter was clearly bona fide. Even the proper officer was under the impression that the requirement was not mandatory otherwise he would have cal ..... X X X X Extracts X X X X X X X X Extracts X X X X
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