M/S. ANAND NISHIKAWA CO. LTD. versus COMMISSIONER OF CENTRAL EXCISE, MEERUT

Citation: [2005] SUPP. 3 S.C.R. 413 · Decided: 23-09-2005 · Supreme Court of India · Bench: S.N. VARIAVA · Disposal: Appeal(s) allowed

Judgment (excerpt)

M/S. ANAND NISHIKAWA CO. LTD. 
A 
v. 
COMMISSIONER OF CENTRAL EXCISE, MEERUT 
SEPTEMBER 23, 2005 
[S.N. VARIAVA AND TARUN CHATTERJEE, JJ.] 
B 
Excise: 
Central Excise Act, 1944: 
c 
Section 11-A(1) proviso (as it stood after 2000 amendment but prior to 
12-5-2000)-Limitation-Extended period of limitation-Applicability of-
"Suppression offacts"-Assessee manufactured rubber profiles which product 
after extrusion was subjected to notching or drilling of a few holes or slilling-
Assessee classified such extruded rubber profiles under Sub-heading 4008.29 D 
which al/racted 'Nil' rate of duty-But the Revenue sought to classify the said 
product under Sub-heading 4016.19 on the ground that the assessee had not 
disclosed the process of notching, slilling etc.-Revenue, accordingly, invoked 
the extended period of limitation and raised a demand-Validity of-Held: 
Department had inspected the assessee 's factory and collected and inspected 
samples of the product before granting approval lo the classification- E 
Moreover, flow-chart submitted to the Department clearly showed the post-
forming process-Under such circumstances, there was no deliberate 
suppression of facts-Hence, demand restricted to six months prior to the 
issue of notice instead of five years. 
Section 11-A(1)-Amendment made in WOO-Object of-Held: To negate F 
certain decisions of Supreme Court and also the High Courts saying that it 
would not be open to the Central Excise Officer to initiate a recovery proceeding 
under Section 11-A of the Act if the classification lists supplied by the assessee 
were approved by the department from time to time-Hence, the view taken 
in such decisions is no longer a valid law. 
G 
Central Excise Tariff Act, 1985: 
Rubber profiles-Classificplion list-Sub-heading 4008.29 or 4016.19-
Applicability-Rubber profiles after extrusion was subjected to notching or 
413 
H 
414 
SUPREME COURT REPORTS [2005) SUPP. 3 S.C.R. 
A drilling of a few holes or slitting-Classification of-Held: Question left open. 
B 
Words & Phrases: 
"Suppression offacts"-Meaning of-in the context of proviso to S. 11-
A(J) of the Central Excise Act, 1944. 
The appellant-assessee was a manufacturer of rubber profiles which 
product after extrusion was subjected to n~ tching or drilling of a few holes 
or slitting. The appellant had classified such extruded rubber profiles 
under Sub-heading 4008.29 of the Central Excise Tariff Act, 1985 which 
attracted 'Nil' rate of duty. The Revenue, however, classified the same 
C under Sub-heading 4016.19. 
A show-cause notice was issued in October, 1995 demanding duty 
for the period from September, 1990 to February, 1994 under the proviso 
to Section 11-A(I) of the Central Excise Act, 1944. The Revenue alleged 
that the appellant had never disclosed to it that it was carrying on the 
D process of notching, slitting, punching, slotting etc. on rubber profiles and 
if it had done so it would have amounted to "further working" thereby 
rendering the products classifiable under Sub-heading 4016.19 and not 
classifiable under the Sub-heading 4008.29. It was also the case of the 
Revenue that the said operations came to the knowledge of the Revenue 
E only when an investigation was carried out. 
The Commissioner of Central Excise (Appeals) held that that there 
was no "suppression of facts" on the part of the appellant and, therefore, 
the extended period of limitation under the proviso to Section 11-A(I) of 
the Act was not applicable. In appeal, the Customs, Excise and Gold 
F (Control) Appellate Tribunal, however, reversed this finding of the CCE 
(Appeals) and found "suppression of facts" from the materials on record 
and held that the Revenue could invoke the proviso to Section 11-A(l) of 
the Act. But the matter was sent back to the CCE (Appeals) for a decision 
on the question of classification and availability of MODVAT credit etc. 
G Against this order of remand the present appeal was filed under Section 
35(L) of the Act. 
The following question arose before the Court:-
Whether the extended period of limitation under proviso to Section 
H 11-A(l) of the Central Excise Act, 1944 would be available or not? 
,.
\ 
.. 
ANAND NISHIKAWA CO.LTD. v. COMMR. OF CENTRAL EXCISE, MEER UT 
415 
Allowing the appeal, the Court 
A 
HELD: 1.1. From the materials on record which were produced 
before the authorities and also from the orders of the Customs, Excise and 
Gold (Control) Appellate Tribunal (CEGAT) and the Commissioner of 

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