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of <h1>Court quashes delayed show cause notices, upholds legal principles. Petition allowed, other issues left open.</h1> <h3>JCBL Limited Versus Principal Commissioner, Ludhiana and others</h3> JCBL Limited Versus Principal Commissioner, Ludhiana and others - 2023 (383) E.L.T. 408 (P & H) Issues Involved:1. Wrongful availing of excise duty exemption.2. Inordinate delay in adjudication of show cause notices.Detailed Analysis:1. Wrongful Availing of Excise Duty Exemption:The petitioner was engaged in fabricating vehicle bodies on chassis received from manufacturers and independent/private owners. While excise duty was paid on vehicles built on manufacturer-provided chassis, the petitioner claimed exemption under Notification No. 06/2006-CE for vehicles built on privately owned chassis. The Revenue disputed this exemption, arguing that Cenvat Credit was wrongly availed on inputs used in manufacturing these bodies. Consequently, two show cause notices were issued: one dated 04.09.2008 for Rs. 1,62,99,205/- and another dated 12.11.2008 for Rs. 2,43,05,657/-.During the proceedings, the petitioner sought relief under the Sabka Vishvas (Legacy Dispute Resolution) Scheme, 2019, which required pending adjudication of show cause notices as of 30.06.2019. The petitioner filed declarations under Section 124(1)(a)(ii) of the SV Scheme, considering the amount paid by reversing Cenvat Credit under Rule 6 of the Credit Rules. However, the Designated Committee disagreed with this computation, disallowing the deduction of the reversed Cenvat Credit amount.2. Inordinate Delay in Adjudication of Show Cause Notices:The petitioner also argued for setting aside the show cause notices due to inordinate delay in adjudication. The court referred to a Division Bench judgment in M/s Shree Baba Exports vs. Commissioner, GST & Central Excise, which interpreted Section 11(A) of the Central Excise Act, 1944. The court emphasized that the Central Excise Officer must serve notice within one year for non-fraudulent cases and within five years for cases involving fraud or collusion. The Division Bench held that delays extending beyond these periods, without plausible explanation, are unreasonable.In this case, the show cause notices issued in 2008 had not been adjudicated, with the only explanation being their transfer to the Call Book as per CVIC guidelines. The court found this explanation insufficient and not a valid reason for the delay. Citing the precedent set in M/s Shree Baba Exports, which was affirmed by the Supreme Court, the court concluded that the inordinate delay rendered the show cause notices unsustainable.Conclusion:The court quashed the show cause notices dated 04.09.2008 and 12.11.2008 due to the inordinate delay in adjudication, following the legal principles established in previous judgments. Other issues raised in the writ petition were kept open, and the petition was allowed on these terms.
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