LexM/S. EASLAND COMBINES, COIMBATORE versus THE COLLECTOR OF CENTRAL EXCISE, COIMBATORE
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A
MIS. EASLAND COMBINES, COIMBATORE
v.
t-
THE COLLECTOR OF CENTRAL EXCISE, CO I MBA TORE
JANUARY 13, 2003
B
(M.B. SHAH AND D.M. DHARMADHIKARI, JJ.}
Central Excises and Salt Act, 19441 Central Excise Rules, 1944-Section
''t~-
/JA and first proviso to sub-section (1) of section /JAi Rule 9(2):
c
Section 11 A-Amendment-Retrospective effect of-Held: Show cause
notice could be issued for correcting errors or mistakes in approval, acceptance
or assessment relating to the rate of duty on or valuation of excisable goods
under the provisions of the Act or the Rules made thereunder within the
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prescr.ibed period
D
Recovery of differential duty-Extended period of /imitation-When
attracted-Held: Can be invoked when duty could not have been paid, short-
levied or short paid or erroneously refunded because of fraud, collusion,
wilful mis-statement, suppression of fact or contravention of any provision or
rules-On facts, mistaken assumption of employee of assessee that as company
registered at one place it was not required to be registered at other place is
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not wilful mis-statement or suppression of fact for attracting extended period
of limitation thus tribunal erred in invoking extended period of /imitation.
The question which arose for consideration in these appeals -is with
regard to the effect of the amendment in section l lA of Central Excises
F and Salt Act, 1944 and whether there was any ground for invoking proviso
to sub-section (1) of Section 1 IA of the Act.
J.--
Appellant-assessee contended that once the excise duty is collected
on the basis of the approved classification, price list or on the basis of the
assessment order it cannot be held that there was short levy of excise duty;
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G that in such cases levying of excise duty on the basis of approved
classification or final assessment order is the correct levy and, therefore,
the amended Section 1 IA would not be applicable; that the amendment
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in Section t IA of Act does not change the basis or the foundation of the
.,.,
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judgment rendered in Cotspun 's case holding that the levy of excise duty
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on the basis of approved classification list is not short levy and the
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EASLAND COMBINES v. COLLECTOR OF CENTRAL EXCISE
99
differential duty cannot be recovered; that presuming that the approved A
,..
price list was erroneous or order was erroneous because of mistake of the
department's officer, assessee cannot be put to loss, otherwise it would
cause hardship to the assessee; and that this power can be misused by
invoking the proviso to Section 11(1), merely stating that duty of excise
has been short levied because of wilful statement or suppression of facts. B
Disposing of the appeals, the Court
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HELD: I.I. In view of the amendment of Section 11-A(I) of the
Central Excises and Salt Act, 1944 show cause notice could be issued for
correcting errors or mistakes in approval, acceptance or assessment c
relating to the rate of duty on or valuation of excisable goods under the
provisions of the Act or the Rules made thereunder within the prescribed
period and thus the decision rendered by this Court in Cotspun 's case that
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that the levy of excise duty on the basis of approved classification list is
not short levy and the differential duty cannot be recovered would not be
a good law. [110-G, H; 114-B]
D
Collector of Central Exicse, Baroda v. Cotspun ltd., (1999) (113) ELT
353, held inapplicable.
Rainbow Industries (P) ltd v. Collector of Central Excise, Vadodara,
(1994( 6 SCC 563; Ballarpur Industries ltd v. Asstt. Collector of Customs E
& Central Excise and Ors., (1995] Suppl. 3 SCC 429; Collector of Central
Excise, New Delhi v. Bhiwani Textiles Mills, (1996) 88 ELT 639 and Mis.
Ujagar Prints and Ors. (II} v. Union of India and Ors., (1989] 3 SCC 488,
referred to.
1.2. From the statement of objects and reasons for amending section F
..
llA, it is clear that the main purpose of the amendment was to fill in the
lacuna pointed out by this Court by interpreting Rule I 0 of the Central
Excise Rules that it does not deal with the classification lists or relate to
..,
the re-opening of approved classification lists. It was to validate certain
actions taken under the Section with retrospective effect, by providing that G
notwithstanding any approval, acceptance or assessment of duty under the
provisions of Central Excise Rules, such show-cause notice could be issued.
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