Customs, Excise and Gold Tribunal - Calcutta
M/S Albert David Ltd. vs Cce, Calcutta-I on 3 July, 2001
Equivalent citations: 2002(147)ELT658(TRI-KOLKATA)
ORDER
Shri K.K. Bhatia
1. The appellants manufacture PP Medicines falling under Chapter 30 of the Schedule to the CETA, 1985. During the period from 16.01.87 to 30.11.88 and again from 1.12.88 to 28.2.90, they cleared samples of PP Medicines manufactured by them by availing exemption under Notfn No. 48/72-CE dt. 1.4.97. This notification excepted the clinical samples of medicines provided interalia that the samples are packed in a form distinctly different from regular trade packing and each smallest packing is clearly marked "Physician's samples, nor to be sold". The departmental authorities observed that the clinical samples cleared by the appellants were identical to the normal trade packing not as smallest packing and they also did not mention on the packing "Physician's samples, not to be sold". Thereby it was alleged that the conditions provided in the exemption notification were not followed and therefore the samples cleared by them were not entitled to the exemption. Accordingly, they were issued a show cause notice dt. 19.12.93 calling upon them to show cause by the amounting to Rs. 11,29,764/- should not be demanded from them under rule 9(2) of the Central Excise Rules, 1944 read with section 11A(1) of the Central Excise Act, 1944 by applying the extended period. They were further called upon to show cause why a penalty should not be imposed on them under rule 173Q(1).
2. On considering the reply of the party, the Commissioner of Central Excise, Calcutta in his order dt. 28.11.2000 held that the demand relating to the period from 1.12.88 to 28.2.90 being within a period of five years was liable to be confirmed and accordingly he confirmed the demand of Rs. 50,000/- on them under rule 173Q. The present appeal and stay petition are against the above order of the Commissioner.
3. We have heard Shri S. Chakraborty, ld. consultant for the appellants and Shri V.K. Chaturvedi, ld. SDR for the respondents. The ld. consultant for the appellants submits that the department had duty approved the classification list allowing them to avail the exemption under the impugned notification. He further states that the packing in which the samples were cleared from their premises were of different sizes than the ones normally sold in the market and this fully satisfied the stipulated conditions that the samples should be distinctly different. Hence, it is pleaded that there is no ground to deny them the above exemption. It is also contended that there is no ground to apply the extended period for the purpose of demand of duty, as there is no suppression of facts on mis-statement since the classification list claiming the exemption had been duly approved by the department and the RT-12 returns were also finalised. It is stated that the Commissioner has confirmed the demand under rule 9(2) of the Central Excise Rules, 1944 had been omitted at the time of passing of the order without any saving clause and on this score also the order passed by the Commissioner is not sustainable.
4. The ld. SDR appearing for the Revenue on the contrary staes that notwithstanding the approval of the classification list, the appellants did not conform to the conditions as prescribed in the notification and therefore there is clear suppression of facts and the violation of particular provisions and therefore the entire amount of duty and penalty imposed on the appellant is liable to be upheld.
5. We have considered the submissions made from both the sides. In the impugned order the Commissioner has observed that in the instant case the notice has cleared samples which were identical to normal trade packing not as smallest packing and without mentioning on the packing "Physician's samples, not to be sold". Only the price was not mentioned on the samples. Accordingly he has held that the stipulation made in the notification has not been followed. We find no effective rebuttal by the appellants against these findings of facts by the adjudicating authority. As regards the contention about the Commissioner invoking the provisions of rule 9(2) it is observed that he has not only referred to these provisions but also has relied on the provisions of Section 11A(1) of the Central Exise Act, 1944. In this view of the matter, the appellants have not been able to make out a prima facie case in their favour either on merits or on time bar. There is no plea of any financial hardship before us. Keeping in view all the facts, we direct the appellants to make a predeposit of Rs. 3,00,000/- (rupees three lakhs) as part of the duty amount confirmed on them within a period of six weeks from today. On making such deposit the balance amount of duty and the penalty shall stand waived and its recovery stayed during the pendency of the appeal. The matter shall be called for reporting compliance on 21.8.2001.
Announced and dictated in the Court.