Customs, Excise and Gold Tribunal - Mumbai
T.K. Ispat (P) Ltd. vs Asstt. Collector Of Central Excise on 20 February, 1989
Equivalent citations: 1989(22)ECR352(TRI.-MUMBAI)
ORDER
1. M/s. T.K. Ispat (P.) Ltd., Koregaon, Bhima Dist., Pune have filed this appeal against the order-in-original No. V(68) 15-25/Adj./87/Pt.II/3079, dt. 3.5.1988 passed by the Assistant Collector Central Excise, Pune IV Dn., Pune confirming show cause cum demand dated 21.1.1988 for Rs. 5,95,687.90 raised against them and also imposing a penalty of Rs. 5000/- on them under Rule 173 of the Central Excise Rules, 1944.
2. The appellants were heard by me on 28.12.1988 through Shri N.D. Khosla, Excise Consultant who reiterated the submissions made in the appeal petition. Shri Khosla also further submitted that they had acted under a bonafide belief that they were entitled to MODVAT credit on the exempted intermediate goods and they had kept the Department informed in the matter as admitted in the show cause notice dated 23.3.1987. It was therefore, not a case of fraud, evasion or suppression of facts on their part. They were not therefore liable to pay any duty beyond a period of 6 months from the date of receipt of the show cause notice under Section 11A nor were they liable to any penalty under the settled law.
3. I have considered the submissions made and have gone through the impugned order. I observe that the show cause notice issued under Rule 57-1 of Central Excise Rules in this case is dated 21.1.1988 and it covers the period from April, 1986 to July, 1987. The Assistant Collector has held in the findings of his order dated 3.5.1988 that the provisions of Section 11 A cannot be made applicable in this case and there is no limit to recover the wrongly availed credit under Rule 57-1. This is not correct. During the period in question, Rule 57-1 contained no limitation of its own and was governed by Section 11 A. As per the amended Section 11A (after the amendment of 27.12.1985) therefore, the show cause notice must have been issued by the jurisdictional Collector and the case decided by him whereas these functions have been performed by the Assistant Collector in the present case. However, it is true that there were doubts during that time on the part of the departmental officers about the time limit in the case of Rule 57-I. Subsequently, however, the Board itself has taken the decision following South Zone Tariff Conference that Section 11A will govern Rule 57-1.
4. Under the circumstances, I vacate the proceedings and direct the Assistant Collector to submit the case to the jurisdictional collector for necessary action on the lines above. The appeal is disposed of accordingly.