TMI Blog2006 (10) TMI 149X X X X Extracts X X X X X X X X Extracts X X X X ..... s were illegal. Appeal dismissed. - 1669-1679 of 2005 - - - Dated:- 31-10-2006 - S.B. Sinha and Dalveer Bhandari, JJ. [Judgment per : S.B. Sinha, J.]. - Completion of an assessment proceedings whether is a sine qua non for issuance of notice under Section 11A of the Central Excise Act, 1944 (for short "the Act") is the question involved in this appeal which arises of a judgment and order dated 18-6-2004 as modified by an order dated 2-7-2004. 2. M/s. ITC Ltd., Respondent No. 1 herein manufactures cigarettes. It gets the work done also by way of job work through various factories. These factories inter alia belonged to M/s. Master Tobacco Company situated at 36/40, Mahalaxmi Birdege Arcade, Mahalaxmi Road, Mumbai and M/s. Crown Tobacco Co. situated at 9, St. John Baptist Road, Bandara, Mumbai. A provisional price list was issued by the Department for the period 1-3-1973 to 28-2-1983. 3. It appears that their existed a dispute as regards mode of valuation for the purpose of levy of excise duty. By a judgment and order dated 19-7-1995, this Court opined that excise duty should be paid on the wholesale dealers price to their customers and not on the price of Respondent No ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ce involved in the present proceedings. The material contained in the said notice can be used as independent material to support final assessment, after affording an opportunity to the noticees concerned to meet the case and after considering the cause shown. The finalization of provisional assessment as aforesaid should be completed as expeditiously as possible. (iii) The said competent authority is further directed to intimate the Adjudicating Authority (CCE, Delhi) as soon as he completes the finalization of the said provisional assessment. After that, this show cause notice involved in the present proceedings will be taken up for adjudication by the said Adj. Authority." 7. Yet again on 13-9-1996, the adjudicating authority passed an Order-in-Original No. 6/1996. The final order of assessment was passed on 16-12-1997. An appeal was preferred thereagainst which was marked as Appeal No. 267/M-I/98. 8. Yet again a show cause notice during pendency of the said appeal was issued on 31-3-1998, purported to be in terms of order dated 16-12-1997 whereby Respondent No. 1 was asked to make payment of the differential duty amounting to Rs. 1,38,00,035.76. An appeal was prefer ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... whereby the appeal by the Department against the Order-in-Original No. 254/2000, dated 22-9-2000 for finalization of provisional assessment in respect of Respondent No. 1 whereby and whereunder it was held that Respondent had paid a sum of Rs. 85 lakhs duty in excess was dismissed. 12. These appeals were heard by the Tribunal and by a final order dated 18-6-2004, it set aside the show cause notices issued and Orders-in-Original inter alia on a finding that the same could not have been done during pendency of proceedings for final assessment. Appellants are, thus, before us. Sub-section (1) of Section 11A of the Act reads as under : "11A. Recovery of duties not levied or not paid or short-levied or short-paid or erroneously refunded. - (1) When any duty of excise has not been levied or paid or has been short-levied or short-paid or erroneously refunded, a Central Excise Officer may, within six months from the relevant 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 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... isions of these rules, the duty provisionally assessed shall be adjusted against the duty finally assessed, and if the duty provisionally assessed falls short of, or is in excess of, the duty finally assessed, the assessee shall pay the deficiency or be entitled to a refund as the case may be." 14. It is not in dispute that now final assessment proceedings are complete. 15. The learned Additional Solicitor General appearing on behalf of Appellant raised a short contention in support of this appeal. A provisional assessment being also an order of assessment and keeping in view the purport and object for which Section 11A of the Act was enacted and read with the definition of "relevant date", the jurisdiction thereunder can be invoked even after a provisional assessment is made and before a final assessment is completed. 16. Mr. Ravinder Narain, learned counsel appearing on behalf of Respondents, however, would submit that a bare perusal of Section 11A of the Act would clearly show that the impugned show cause notices were illegal. 17. Section 11A of the Act provides for a penal provision. Before a penalty can be levied, the procedures laid down therein must be complied with. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nt or furnish any information necessary for assessment of duty on any excisable goods. 22. Whereas provisional duty is levied in terms of Sub-Rule (1) of Rule 9B, final assessment is contemplated under Sub-Rule (5) thereof by reason of which the duty provisionally assessed shall be adjusted against the duty finally assessed and in the event, the duty provisionally assessed falls short of or is in excess of the duty finally assessed, the assessee will pay the deficiency or will be entitled to a refund, as the case may be. Ultimately, thus, the liability of the assessee would depend upon the undertaking of exercises by the assessing officer to complete the assessment proceeding as contemplated under the Rules. 23. On a plain reading of the provisions of the Act and the Rules framed thereunder, we have no doubt in our mind that the Tribunal was correct in its finding that the impugned show cause notices were illegal. 24. The question came up for consideration before this Court in Serai Kella Glass Works Pvt. Ltd. v. Collector of C. Excise, Patna [1997 (91) E.L.T. 497 = (1997) 4 SCC 641] wherein this Court clearly opined : "Section 11A deals with recovery of duty not levied or ..... X X X X Extracts X X X X X X X X Extracts X X X X
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