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Issues: Whether the demand for short-levy on mono block pump sets was recoverable under Rule 9(2) of the Central Excise Rules, 1944, or was barred by limitation and recoverable only under Rule 10 read with Rule 173J of the Central Excise Rules, 1944.
Analysis: The price list filed by the petitioners had been finally approved after due consideration. The short-levy arose from an omission on the part of the departmental officers in not including the duty element on the electric motor in the assessable value. In such circumstances, recovery of the short-levy could be made only under Rule 10 read with Rule 173J of the Central Excise Rules, 1944. A demand raised under Rule 9(2) was therefore not the proper course, and the original demand issued after expiry of one year from the date of payment of duty was time-barred.
Conclusion: The demand was barred by limitation and unsustainable under Rule 9(2); the revision application was allowed in favour of the assessee.
Ratio Decidendi: Where short-levy results from departmental error after final approval of the assessable value, recovery must be pursued under the limitation-governed provision applicable to mistakes and not under a provision invoked for a different class of demand.
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