TMI Blog1981 (12) TMI 38X X X X Extracts X X X X X X X X Extracts X X X X ..... certained that gross weight had been considered instead of net weight and the price of the gunny bag had not been included. It may be noted in this connection that under a notification dated 1st March, 1975 issued under the Central Excise Rules, 1944, tobacco falling under Item 4(II)5 of the First Schedule to the Act of which the value did not exceed Rs. 10.00 per kilogram was exempted from so much of excise duty leviable thereon as was in excess of 5% ad valorem. 3. On 12th March, 1976 the excise authorities wrote to the petitioners demanding the difference in excise duty on the basis of the revised price list from 1st October, 1975 onwards. The petitioners preferred an appeal against the order revising the price list. After hearing the petitioners the Appellate Collector observed "…… Keeping in view the fact that duty is on the branded tobacco, packing is a must and so its weight as accepted necessary has to be included to arrive at the value of chewing tobacco. If the goods are cleared on gate passes with bags, then the cost of packing has to be included in the assessable value. The Assistant Collector will please look into the matter and rate of duty may be fixed after takin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... idence on record. 5. I find that the party has not been able to explain satisfactorily regarding the post-manufacturing charges recovered by them from the customers, at the rate of Rs. 20.25, Rs 18.25 and Rs. 14.00 per bag in respect of Kisan Tota, Vijay Tota and Kisan TLD varieties of jarda respectively. This is obviously a vain effort on the part of the assessee to manipulate the prices on a higher side for their own benefit. Hence I hold that these post-manufacturing charges should be included in the assessable value for the purpose of assessment. He stated that the question as to whether gross weight had to be taken for the purpose of determining the assessable value had become insignificant; that the price of gunny bags was not to be included in the assessable value of the goods; and that the price at which the goods had been sold through a relative was the same as that at which they had been sold to others. He went on to say that "...due the fact that a portion of revised demand amounting to Rs. 14,712.80 is hit by time bar under Rule 10 of Central Excise Rules, 1944, I reduce the demand by that much amount, and order that M/s. P.P. Patel Co., Sholapur, shall pay remainin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... re optional and did not form part of the assessable value. Having come to that conclusion the Government set aside the order-in-appeal and restored the order of the Assistant Collector. 8. Against this order in revision the petitioners have filed the present petition. 9. It was suggested by Mr. Parekh, learned Counsel for the petitioners, that the revision by the Central Government was not computed in time. To understand that it is necessary first to set out Section 36, sub-section (2) as it existed at the relevant time. It reads thus : "The Central Government may, of its own motion or otherwise, call for and examine the record of any proceeding in which any decision or order has been passed under Section 35 or Section 35A of this Act for the purpose of satisfying itself as to the correctness, legality or propriety of such decision or order and may pass such order thereon as it thinks fit : Provided that no decision or order shall be varied so as to prejudicially affect any person unless such person is given a reasonable opportunity of making a representation and, if so desires, of being heard in his defence : Provided further that no proceedings shall be commenced under ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... through inadvertence, error, collusion or misconstruction on the part of an officer, or through mis-statement as to the quantity, description or value of such goods on the part of the owner, or when any such duty or charge, after having been levied, has been owing to any such cause, erroneously refunded, the proper officer may, within three months from the date on which the duty or charge was paid or adjusted in the owner's account-current, if any, or from the date of making the refund, serve a notice on the person from whom such deficiency in duty or charges is or are recoverable requiring him to show cause to the Assistant Collector of Central Excise why he should not pay the amount specified in the notice. (2) The Assistant Collector of Central Excise, after considering the representation, if any, made by the person on whom notice is served under sub-rule (1), shall determine the amount of duty or charges due from such person (not being in excess of the amount specified in the notice and thereupon such person shall pay the amount so determined within ten days from the date on which he is required to pay such amount or within such extended period as the Assistant Collector of C ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... vant date, serve notice on the person chargeable with the duty which has not been levied or paid or which has been short-levied or short-paid or to whom the refund has erroneously been made, requiring him to show cause why he should not pay the amount specified in the notice." 17. Reference was made by Mr. Parekh to a Division Bench Judgment of the Delhi High Court in Associated Cement Companies Ltd. v. Union of India - 1981 E.L T. 421. In that case the Superintendent of Central Excise issued demand orders dated 23rd October, 1976 and 27th August, 1977 to the petitioners therein in respect of short-levy of excise duties. Appeals were preferred and the demands made in the said orders were therein ordered to be withdrawn. The Central Government issued the two impugned notices on 12th November, 1979 and 17th November, 1979 under Section 36(2) of the Act calling upon the petitioners to show cause why the orders of the Appellate Collector should not be reviewed. The impugned notices were issued after the expiry of six months but within a period of one year after the orders of the Appellate Collector were passed. It appears that it was not pointed out to the court that during the perio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e fresh points were relevant to the case and whether reasonable opportunity had been given to the petitioners to explain their stand in that regard. 21. It was lastly contended that the demand was beyond the scope of Section 4 of the Act because post-manufacturing charges had been added to the assessable value of the goods. There was no material before the Assistant Collector upon which he could judge whether any post-manufacturing charges had or had not, in fact, been incurred. He, therefore, held that showing an amount as post-manufacturing expense was "obviously a vain effort on the part of the assessee to manipulate the prices on a higher side for their own benefit". It was admitted before us that no material was filed by the petitioners upon which the Assistant Collector or the Appellate Collector could judge whether the post-manufacturing expenses which the latter itemised had in fact been incurred by the petitioners. There can be no doubt that the heads of expenses itemised are post-manufacturing expenses. But there was, and is, no material upon which it could be said that these expenses had in fact been incurred by the petitioners and to what extent. In that view of the m ..... X X X X Extracts X X X X X X X X Extracts X X X X
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