Show cause notice sufficiency and notice-period limits in central excise demand, with recovery confined to the period stated.

A central excise demand was upheld where the show cause notice, though it did not cite the exact rule or quantify the amount, made the basis of liability clear and was issued by a competent authority; objections based on limitation, Article 265, and exemption linked to countervailing duty on imported raw materials were rejected. However, duty could not be recovered for a period not covered by the notice, so the demand for 1-10-1972 to 30-3-1973 was set aside while the demand for the notified period was sustained. The governing principle is that a notice is not invalid merely for lack of exact particulars if the charge is otherwise clear, but recovery cannot extend beyond the notice period.

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Issues: (i) whether the demand of central excise duty was invalid for want of a proper show cause notice, for alleged bar of limitation, for non-specification of the amount, and for denial of exemption based on countervailing duty already paid on imported raw material; and (ii) whether duty could be demanded for a period not covered by the show cause notice.

Issue (i): whether the demand of central excise duty was invalid for want of a proper show cause notice, for alleged bar of limitation, for non-specification of the amount, and for denial of exemption based on countervailing duty already paid on imported raw material.

Analysis: The notice dated 22-12-1975 was held to be sufficient, even though it did not mention the precise rule or quantify the exact amount, because the competent authority had authority to raise the demand and the basis of the demand was otherwise made clear. The objections based on Rule 10 and Rule 10A, limitation, and Article 265 of the Constitution of India were rejected. The claim that countervailing duty was equivalent to excise duty was also rejected, and the claimed exemption benefits were not accepted.

Conclusion: The challenge to the legality of the demand notice, limitation, Article 265, and the exemption-based defence failed, and the demand was upheld on those grounds.

Issue (ii): whether duty could be demanded for a period not covered by the show cause notice.

Analysis: The show cause notice covered removals from 31-3-1973 to 31-5-1975, but the assessment order included the earlier period from 1-10-1972 to 30-3-1973. The demand for the period not mentioned in the notice could not survive and had to be excluded.

Conclusion: The demand for 1-10-1972 to 30-3-1973 was set aside, while the demand for the notified period was sustained.

Final Conclusion: The appeal succeeded only to the limited extent of excluding duty for the period not covered by the show cause notice, and the remaining duty demand was sustained.

Ratio Decidendi: A demand notice is not invalid merely because it does not specify the exact rule or quantified amount if the liability and basis of demand are otherwise clear and the competent authority had jurisdiction, but duty cannot be recovered for a period not covered by the show cause notice.

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