Tribunal overturns order, citing lack of excise duty evidence, goods exemption, new notice, and time limit.

The Tribunal set aside the impugned order, finding the demand unsustainable on merits because no amount was shown as representing excise duty in the appellant's documents, the goods were fully exempt from duty until 2008, the principle of res judicata did not apply due to the issuance of a new show cause notice under amended provisions, and the demand was time-barred as per the limitation period under Section 11A. The appeal was allowed with consequential benefits as per law.

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Issues Involved:
1. Applicability of Section 11D of the Central Excise Act, 1944.
2. Collection of amounts representing excise duty.
3. Principle of res judicata.
4. Time limit for issuing show cause notices under Section 11D.

Detailed Analysis:

1. Applicability of Section 11D of the Central Excise Act, 1944:
The appellants were manufacturers of Asbestos Cement products, some of which used more than 25% Fly Ash and were exempt from excise duty under Notification No.60/91-CE. The department argued that the appellants collected amounts indirectly representing excise duty from their customers and should deposit these amounts under Section 11D. However, the Tribunal noted that Section 11D did not cover goods wholly exempt from duty until the introduction of Section 11D (1A) in 2008. The amendment was not retrospective, thus not applicable to the appellant’s goods for the period in question.

2. Collection of Amounts Representing Excise Duty:
The department contended that the appellants charged the same price for both duty-paid and exempted products, implying that they collected amounts representing excise duty. The Tribunal found no evidence that the appellants collected any specific amount as excise duty. The invoices showed a consolidated price "inclusive of excise duty," but no specific amount was indicated as excise duty. The Tribunal concluded that Section 11D could not be invoked unless an amount was clearly shown as representing excise duty.

3. Principle of Res Judicata:
The original show cause notices (SCNs) were quashed by the Hon’ble High Court of Madras, but the department issued a new SCN after the amendment of Section 11D. The Tribunal found that the principle of res judicata did not apply because the new SCN was issued under amended provisions, as allowed by the High Court’s judgment. The original SCNs were treated as non est, making the new SCN the first round of litigation under the amended law.

4. Time Limit for Issuing Show Cause Notices Under Section 11D:
The SCN was issued on 07.09.2011 for the period February 1992 to December 1995, well beyond the five-year period typically considered under Section 11A. The Tribunal noted that while Section 11D had no specific time limit, the Hon’ble High Court of Allahabad in CCE Vs Standard Niwar Mills held that the limitation under Section 11A should apply to Section 11D. Thus, the Tribunal found the demand time-barred.

Conclusion:
The Tribunal set aside the impugned order, finding the demand unsustainable on merits because:
- No amount was shown as representing excise duty in the appellant’s documents.
- The goods were fully exempt from duty and not covered by Section 11D until 2008.
- The principle of res judicata did not apply due to the issuance of a new SCN under amended provisions.
- The demand was time-barred as per the limitation period under Section 11A.

The appeal was allowed with consequential benefits as per law.

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