Customs, Excise and Gold Tribunal - Tamil Nadu
Collector Of Central Excise vs Nu-Wood Private Ltd. on 11 April, 1982
Equivalent citations: 1983ECR995(TRI.-CHENNAI)
ORDER
1. Appeal under Section 35B of the Central Excises and Salt Act, 1944, praying that in the circumstances stated therein, the Tribunal will be pleased to set aside the Order No. I82/82(M) dated 26.5.82 passed by the Appellate Collector of Central Excise Madras.
2. This appeal coming up for orders upon perusing the records and upon hearing the arguments of Shri A. Vijayaraghavan, Departmental Representative for the appellant and upon hearing the arguments of Shri P.N. Menon, authorised representative for the respondent, the Tribunal makes the following:
3. This is an appeal by the Collector of Central Excise, Madras against the Order-in-appeal No.l82/82'M) dated 26.5.82 of the Appellate Collector of Central Excise, Madias, allowing an appeal from M/s. Nu-wood Private Lid. with consequential relief to them. The circumstances leading to the appeal are as follows:
4. Dining the period 7.4.79 to 6.10.79 M/s. Nu-wood Private Ltd., the respondents in the present appeal, were manufacturing and clearing office machines falling under them 33-D of the Central Excise Tariff on payment of Central Excise duly; office machines are chargeable to duty ad valorem', the machines were being sold to M/s .MacNeill and Magor Ltd., Madras, who in Hun sold them to others; the Department had held that M/s. MacNeill & Magor Ltd. arc a related person vis-a-vis M/s. Nu-wood Private Ltd. and decided to charge to duty on the basis of the price at which M/s. MacNeill and Magor Ltd. s: Id the office machines and not the price at which they bought them from the respondents. The manner of assessment came to be agitated finally in the Madias High Court. That Court remitted the case back to the Assistant (Yllector for de novo adjudication. By his order No. V/33-D/ 17/2/78- VC dated 31.12.81 the Assistant Collector accepted the price at which the respondent sold the goods to M/s. MacNeill and Magor Ltd. In a letter bated 13.5.80 the respondents preferred a claim for Rs. 1 lakh on the score that they were entitled to the exemption contained in Notf. No. 71/78-CE dated 1.3.78. This notification exempts clearances during a financial year of office machines, amongst other items, upto Rs. 5 lakhs from payment of duty provided that the value of such goods cleared by the manufacturer during the provirus year did not exceed Rs. 15 lakhs. Because of the re-valuation of their goods, the respondents came within the limit of Rs. 15 lakhs for the year 1978-79 and hence qualified for claiming exemption for clearances upto Rs. 5 lakhs in 1979-80. In his order No. V/33D/18/35/8O dated 25.11.81 the Assistant Collector rejected the claim as, on the basis of the earlier determination (that is without reference to the directions of the High Court and in his own order dated 31.12.81, which were passed at a later date) the value of clearances of the respondents during the year 1978-79 had exceeded Rs. 15 lakhs. When the matter came up in appeal before the Appellate Collector, he look note of the later cider, No.V/33-D/17/2/78-VC dated 31.12.81, issued by the Assistant Collector regarding assessable value being based on (he sale price of the respondents to M/s. MacNeill and Magor Ltd.; he allowed the appeal with consequential relief to the respondent. In doing so the question of time-bar, if any, applicable to the claim of the respondents was not kept in view. It is the department's contention now that the claim is barred by limitation under Rule 11 of the Central Excise Rules, 1944 (as it existed at the time of preferring of the claim), as the claim was preferred after the lapse of six months from the date of payment of duty: the duty was not paid under protest in so far as the assessability of the goods themselves to duty was concerned.
5. The representative of the respondents urges that the claim is not barred by limitation; the time-limit for computation should run from the closing of the financial year namely, 31.3.80. For this view he relied on the Judgment of the Kerala High Court in the case of T.T. Pvlunny Royal Smiths, Kunnakulam v. Union of India and Ors. 1978 E.L.T. (J 705). In para 7 of that Judgment Mis Lordship has observed that the period of limitation will only commence from the last dale of the year. We are afraid that the reference to this Judgment is not relevant to the facts of the present case. In the case considered by the Kerala High Court the claim was in respect of clearances of steel furniture under Notification No. 90/68-CE dated 30.4.68 during the year 1969-70; the exemption was itself related to the value of clearances during the same financial year 1969-70. in I he present case the eligibility for concession is related not to clearances during the same financial year but to those during the previous financial year. The quantum and value of clearances in the previous financial year should be known to a claimant for a claim during the subsequent year.
6. As an alternate plea, the representative of the respondents claims that duty was paid under protest and refers to letter No. NW/JAN/31/76 dated 12.1.76 from the respondents to the Assistant Collector of Central Excise, Madras IV Division, Madras. He claims that protest would mean that the assessment is provisional in all respects, including the suitability of the machines itself. The Departmental Representative, however. draws our attention to letters Nos. ZH/360 dated 1.3.78 addressed to the Superintendent of Central Excise, Group XXIV, Madras IV Division and ZH/2' 9 dated 19.8.78 and 1063/79 dated 6.9.79 addles ed to the Assistant Collector of Central Excise, Grot p IV, Division IV, Madras as well, wherein the nature of the protest already made by the respondents have been clearly indicated. Paragraph 2 of the letter dated 12.1.76 reads as follows :
In the meantime with a view to clear the goods and keep the factory running, we submit the enclosed price-list for your approval under protest and without prejudice to our rights to any recourse open to us for remedy.
For one thing this letter speaks specifically of what the respondent is protesting about. For another the protest was made in January 1976 when Notification No. 71/78 was not in existence, having been issued more than two years thereafter. It is far fetched to claim that the protest made in 1976 would cover a situation that arose by issue of a notification in March 1978. Contemporaneous to the issue of the notification No. 71/78 is the letter dated 1.3.78. It deals throughout with the question of valuation in the context of a reduction in selling prices; the respondents could not have had any other aspect in view as it ends with the words, We hope that the department will have no further difficulty in sub-milting the price-list for approval on the basis of your own recommendations as it is purely in the interest of the revenue that the price has been revised.
The letter dated 6.9.79 also confines itself to the issue of price-lists, the price fixed by the department for purposes of valuation and acceptance of price-lists.
7. In the light of the above analysis we are clear in our mind that the issue of non-assessability of the office machines to duty, as distinct from the value to be adopted for their assessment, had not been raised with the Department prior to the respondents' claim dated 20.5.80; that they would be entitled to the benefit of Notification No. 71 /78 in the event of the value declared by them for purposes of assessment and which had been under dispute since 1976, is acceptedshould have been known to the respondents all along. If they wished to reserve their position in regard to excitability as well, they should have filed a letter of further protest or filed a claim pointing out the possibility that clearances during part of the year 1979-80 would not be liable to duty at all. Under the circumstances we allow the appeal and set aside the order of the Appellate Collector inasmuch as it does not deal with the issue of time bar. We find that the claim of the respondents is barred by limitation under Rule 11 of the Central Excise Rules, 1944 as it existed at the relevant time.