Provisional release and duplicate duty demand: normal-period notice stands, but fresh duty on already assessed goods fails.

A notice issued within the normal limitation period under Rule 9(2) is not converted into one under the proviso to Section 11A merely because it refers to clandestine removal; such language may remain descriptive, so the jurisdictional challenge fails. Where goods have already suffered duty on provisional clearance, a fresh demand on the same seized goods is impermissible as a duplicate levy, and that demand is set aside. Provisional release does not prevent confiscation, redemption fine, or penalties where the goods are otherwise liable to confiscation, so those consequences may still be sustained.

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Issues: (i) whether the show cause notice issued by the Assistant Collector was without jurisdiction on the ground that the case attracted the extended period under the proviso to Section 11A; (ii) whether the duty demand was sustainable when the goods had already been cleared on provisional assessment and duty was again demanded on the seized goods; and (iii) whether redemption fine and penalties could be sustained despite provisional release of the goods.

Issue (i): whether the show cause notice issued by the Assistant Collector was without jurisdiction on the ground that the case attracted the extended period under the proviso to Section 11A.

Analysis: The notice was issued within the normal period and was expressly founded on Rule 9(2) for removal of excisable goods without payment of duty. The reference to clandestine removal was treated as descriptive of the facts and not as an invocation of fraud, suppression, or other ingredients of the proviso to Section 11A. Since the notice did not invoke the extended period, the Assistant Collector was competent to issue it.

Conclusion: The notice was validly issued and the jurisdictional challenge failed.

Issue (ii): whether the duty demand was sustainable when the goods had already been cleared on provisional assessment and duty was again demanded on the seized goods.

Analysis: The explanation that the excess goods in the van matched the shortage in the factory was not accepted, as the quantities did not tally and there was no corresponding production entry for the relevant lot. However, the seized goods had already suffered duty on provisional clearance. A fresh demand on the same goods would amount to a second levy, which was not permissible.

Conclusion: The further duty demand on the seized goods was unsustainable and was set aside.

Issue (iii): whether redemption fine and penalties could be sustained despite provisional release of the goods.

Analysis: Provisional release did not extinguish the power to order confiscation and impose redemption fine if the goods were otherwise liable to confiscation. The provisional custody of the goods therefore did not invalidate the redemption fine. On the facts found, the penalties were also justified.

Conclusion: The redemption fine and penalties were sustained.

Final Conclusion: The appeal succeeded only to the limited extent of deleting the duplicate duty demand, while the findings on jurisdiction, redemption fine, and penalties were maintained.

Ratio Decidendi: A notice issued within the normal period for recovery of duty under Rule 9(2) is not converted into one under the proviso to Section 11A merely because it uses the expression clandestine removal, and provisional release of goods does not bar redemption fine where confiscation is otherwise justified.

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