Limitation and provisional assessment rules barred excise demand, while Notification No. 42/75 extended concessional duty to secondary manufacturers.

Once assessment was finalised and provisional assessment was no longer pending, the demand could not be recovered as if it remained provisional; the statutory limitation under the relevant excise rules had also expired, so the duty demand was time-barred. On exemption, Notification No. 42/75 was held to cover manufacturers of electrical conductor grade aluminium and not only primary producers, and the secondary manufacturers had been allotted such aluminium for conductor manufacture. The restrictive interpretation adopted below was rejected, and concessional duty treatment was allowed with consequential relief.

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Issues: (i) Whether the demand for duty was barred by limitation and whether the assessment could still be treated as provisional under Rule 9B of the Central Excise Rules. (ii) Whether the appellants, being secondary manufacturers, were entitled to the concessional rate of duty under Notification No. 42/75.

Issue (i): Whether the demand for duty was barred by limitation and whether the assessment could still be treated as provisional under Rule 9B of the Central Excise Rules.

Analysis: The assessment could not be treated as continuing provisional assessment once the Superintendent had demanded duty and the subsequent request for provisional assessment had been rejected. Approval of the classification list also negatived the claim that the assessment remained provisional. On the facts, the relevant limitation under Rule 10 read with Rule 173J had expired long before the show cause notice was issued.

Conclusion: The demand was barred by limitation, and the plea that the assessment remained provisional was rejected.

Issue (ii): Whether the appellants, being secondary manufacturers, were entitled to the concessional rate of duty under Notification No. 42/75.

Analysis: Notification No. 42/75 referred to manufacturers of aluminium declared as electrical conductor grade and did not confine the benefit only to primary producers. The Aluminium (Control) Order, 1970 regulated production, supply, and distribution by reference not only to producers but also to manufacturers and dealers, and the appellants had been allotted electrical grade aluminium for manufacture of conductors for supply to State Electricity Boards. The restrictive view taken by the lower authorities was therefore unsustainable.

Conclusion: The appellants were eligible for the benefit of Notification No. 42/75.

Final Conclusion: The duty demand could not be sustained, and the appellants were entitled to the concessional treatment claimed under the exemption notification, with consequential relief.

Ratio Decidendi: Once assessment has been finalised and the statutory period of limitation has expired, duty cannot be recovered as if the assessment continued to be provisional; an exemption notification expressed in terms of manufacturers cannot be confined only to primary producers unless its language clearly so requires.

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