Customs, Excise and Gold Tribunal - Delhi
Andhra Pradesh State Electricity Board vs Collector Of Central Excise on 27 January, 1988
Equivalent citations: 1988(35)ELT199(TRI-DEL)
ORDER V.T. Raghavachari, Member (J)
1. Shri V. Krishnamurthy, Advocate representing Shri K. S. Choudhary, Advocate sought for adjournment in these matters, on the ground that Shri Choudhary was away from Delhi and could not be present. Taking note of the fact that none was present on behalf of the appellants even on the earlier hearing on 10.11.1987 and that no reason was stated as to why Shri Choudhary was not present for the hearing except that he was away from Delhi, the adjournment sought for was declined and the hearing was proceeded with.
2. We have heard Shri Balbir Singh for the Department and have perused the records. Shri Krishnamurthy had stated that except for seeking an adjournment he had no other instructions for making any submissions on the issues in the appeals.
3. The issues arising in these appeals are common and all the appeals are, therefore, being disposed of under this common order. The common appellant in all these appeals is the Andhra Pradesh State Electricity Board. The appeals relate to the liability, on the part of the Board, for payment of excise duty on the PSCC and RCC poles manufactured by the Board for use in the electricity distribution by them. Demands had been raised on the ground that these poles are liable for payment of excise duty under Item 68 of the CET but that without taking out the necessary licence therefor and withou't observing the necessary formalities the appellant Board had manufactured and removed such poles without payment of duty.
4. The following chart will give the necessary details in respect of the demands in these appeals.
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Appeal Date of Period Autority Unit to which
No. S. C. passing the the procced-
Noicce order ing relate
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(1) (2) (3) (4) (5)
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1. 1150/83 29.3.1982 18.6.77 to Additional Collector Unit to which 31.3.80 Hyderabad
2. 1151/83 26.2.1982 18.6.77 to - do - Palamaner
3. 2138-84 13.6.1979 O-in-O by Asstt. Mulamaner Collector, Guntur O-in-A by Collector (Appeals), Madras
4. 2147/84 12.6.1979 - do - Ongole
5. 545/85 11.8.1983 14.6.79 to - do - Markapur 31.3.81
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5. On the questions whether the Andhra Pradesh State Electricity Board is the actual manufacturer and whether the goods are liable for duty under Item 68 CET, we have the earlier decision of this Tribunal on similar facts in the case of the same appellant, reported in 1984 (16) ELT 579. We may also note that in the statement of facts in appeal No. 1151 of 83 it is stated that "the Board has set up various centres for manufacture of PSCC and RCC poles exclusively for the use of Andhra Pradesh State Electricity Board". Thus the issue that the Board is the manufacturer is not in dispute and, as already stated, the judgment cited supra is to the effect that the appellants are liable to pay duty under Item 68 CET.
6. In all these appeals the demands have been raised pressing into service the larger period of limitation of 5 years, on the basis that the Board having manufactured and removed the poles without obtaining necessary licence and without payment of duty, the relevant provisions relating to the larger period of limitation applied. This is questioned in these appeals.
7. We may note that in appeals 2138/84 and 2147/84 the Collector (Appeals) has held that since the question of time bar has not been considered by the Assistant Collector under his orders the matter was to go back to the Assistant Collector for a consideration of this issue of time bar. We may further note that so far as these two appeals are concerned they have not been filed within time and hence necessary applications for condonation have been filed. The reason stated in the applications is that the Board had to correspond with their Advocate at New Delhi for advice and had to get the papers circulated before taking a decision and hence there has been delay. We are of opinion that the reason stated is not sufficient to explain the delay. No details are given as to when the Advocate was contacted when he gave the opinion when, on the basis of the said opinion, the Board took its decision etc. In the absence of these details we are unable to conclude that the Board, in spite of acting with promptitude, was, due to other administrative reasons, not able to file the appeals within the prescribed time. In the circumstances, we hold that the appellant-Board has not shown sufficient cause for condonation of the delay in the filing of these two appeals. Hence so far as these two appeals are concerned they are to be dismissed as barred by time.
8. So far as the other 3 appeals are concerned it appears to us that here also the matter may have to be reconsidered by the Assistant Collector on the question of time bar. In appeal No. E-l150/83-D we find reference to a letter dated 14.7.1979 from the Inspector of Central Excise, Kuppam to the Supervisor of the Andhra Pradesh State Electricity Board at Kuppam wherein the Inspector had called upon the Supervisor to take steps to take out a Central Excise licence for the manufacture of poles. This letter in fact refers to an earlier letter from the Board dated 12.7.1977. It is, therefore, clear that so far as this appeal is concerned, and so far as the Kuppam Unit is concerned, the Department was aware at any rate by 14.7.1979 (and probably by 12.7.1977 or even an earlier date) that the Appellant Board was engaged in the manufacture of these poles. Similarly, in appeal No. 1151/83, we find a reference to a letter dated 3.11.1980 from the Central Excise Officer to the Divisional Engineer regarding the manufacture of poles and liability for payment of duty. We are not sure whether it was only on this date that the Department could be imputed with the knowledge of the manufacturing activity of the Board or even an earlier date.
9. So far as the appeal No. 545/84 is concerned, we find in the memorandum of appeal reference to a letter dated 4.7.1978 from the Assistant Collector of the Central Excise (Audit), Hyderabad to the Superintending Engineer (Operations), Nellore regarding the manufacture of poles and the liability for payment of duty etc. The above information, put in the form of a chart, reads as follows :
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Appeal Show cause Period Letter entioned in No. notes dated the earlier paragraph
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(1) (2) (3) (4)
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1150/83 29.3.1982 18.6.1977 to 14.7.1979/12.7.1977
31.3.1980
1151/83 26.2.1982 18.6.1977 to 3.1.1980
31.3.1981
545/85 11.8.1983 14.6.1979 to 4.7.1978
31.3.1981
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10. Under the relevant provisions the Department would be bound to issue a demand for duty not paid within six months from the date duty was to be paid but that the period would be 5 years from the said date if the non-payment of duty was due to wilful suppression or mis-statement of facts etc. It would, therefore, appear to us that in each of the said cases the period of 5 years would have been available to the Department in respect of all removals prior to the date when the Department was, or would have been, aware of the manufacturing activity of the Board, but the period of six months only after the said date. It appears to us that the authorities below were in error in applying the 5 year period irrespective of the fact whether duty demanded became payable on a date either before or after the date of knowledge of the Department. We refer in this connection to the judgment of this Tribunal in Vishwa Industrial Works, Bombay v. Collector of Central Excise, Bombay reported in 1987 (31) ELT 976. We are, therefore, satisfied that in these 3 appeals (1150/83, 1151/83 and 545/85) the orders of the lower authorities are to be set aside for the above reason and the matter will have to be remanded to the concerned authorities (Additional Collector in the first two matters and the Assistant Collector in the last matter) for going into the question as to on what date the Department became aware of the manufacturing activity of the appellants and their consequent liability for payment of duty and invoke the six months or 5 year period with reference to the period after or before the said date. As earlier mentioned, the Collector (Appeals) himself has remanded the matter to the Assistant Collector in the other two appeals (2138/84 and 2147/84) for going into the question of time bar. In those matters also the Assistant Collector will have to consider the question of time bar with reference to the principle mentioned earlier. In addition, we note that in appeal No. 545/85 the Collector (Appeals) has remanded the matter to the Assistant Collector for considering the question of valuation also.
11. In the result, Excise appeals 2138/84 and 2147/84 are dismissed as time barred. Appeal Nos. 1150/83 and 1151/83 and 545/85 are allowed and orders of the lower authorities are set aside, remitting the matter to the original authorities as mentioned earlier for readjudication in the light of the principles mentioned above.