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Introducing the “In Favour Of” filter in Case Laws.
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of <h1>Service of show cause notice and limitation: postorder or noticeboard posting does not validate timebarred SCNs; relief granted.</h1> Service of a show cause notice (SCN) must precede issuance of an adjudicatory order; SCN pasted on a departmental notice board after return from post does ... Demand of duty - demand by serving a show cause notice u/s 11A - limitation-extended period of five years - non-payment or short payment of duty - fraud, collusion, wilful mis-statement or suppression as exception to limitation - pasting notice on notice board not valid service - service after passing order cannot cure lack of prior notice - HELD THAT:- The undisputed position is that the appellant had changed its address and intimated the change to the department but the SCN was sent to the old address and when it was returned by the postal department, it was pasted on the notice board of the office of the department. This cannot be termed service of notice. After the order was passed, the appellant sought the SCN and it was served on 24.7.2012 beyond the period of five years from the relevant period. The Annexures to the SCN and the relied upon documents were served even later. Thus, the SCN was clearly time barred and the impugned order deciding the proposals therein cannot be sustained. The SCN must be served before issuing the order and not after the order has been issued. The very purpose of issuing an SCN is to give the noticees an opportunity to show cause which cannot be served if the order is passed without serving the SCN. We find that the impugned order cannot be sustained because the SCN was served beyond the extended period of limitation of five years. It is, therefore, not necessary for us to consider the other submissions made by both sides. The impugned order is set aside and both appeals are allowed with consequential relief to the appellants. Issues: Whether the show cause notice dated 11.4.2011 was served within the permissible period under Section 11A of the Central Excise Act, 1944 and whether the impugned order passed pursuant to that notice is sustainable.Analysis: The impugned adjudication proceeded on a SCN alleged to relate to clandestine removals during 1.4.2007 to 30.6.2007. Service of the SCN was attempted at the assessee's old address and, after postal return, the SCN was affixed on the department's notice board. The complete SCN and its annexures were in fact delivered to the appellants only on dates substantially later, the final relied-upon documents being served well beyond five years from 30.6.2007. Section 11A permits demand by serving an SCN within the normal two-year period and within an extended five-year period only where specified exceptions such as fraud or collusion are shown; no valid service can remedy an expired limitation. Service effected after issuance of the impugned order cannot substitute for service prior to adjudication and does not cure non-compliance with limitation requirements.Conclusion: The SCN was served beyond the extended five-year limitation period under Section 11A of the Central Excise Act, 1944; the impugned order is unsustainable and is set aside, and the appeals are allowed in favour of the assessee.
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