Provisional central excise assessments: limitation for duty demand runs from finalisation, not earlier clearance, where approval was pending.

Provisional assessment under Rule 9B of the Central Excise Rules, 1944 affects the limitation period for duty demands under Section 11A of the Central Excise Act, 1944. Where clearances are made subject to final approval and classification lists are later finalised, the relevant date for limitation is the date of finalisation, not the earlier clearance period. On the facts, the assessments under both classification lists were treated as provisional, and the show cause notice issued after finalisation was held to be within time. The limitation objection therefore failed, and the duty demand was not time barred.

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Issues: Whether the demand of duty was barred by limitation, and whether the clearances were to be treated as provisional assessments till finalisation of the classification lists.

Analysis: The demand had to be examined in the light of the provisional assessment procedure under Rule 9B of the Central Excise Rules, 1944 and the limitation under Section 11A of the Central Excise Act, 1944. The Tribunal held that where provisional assessment was requested and the goods were cleared subject to final approval, the relevant date for computing limitation was the date of finalisation of the assessment. The Tribunal further held that, on the facts, the assessments under both classification lists were provisional and the show cause notice issued after finalisation on 14-5-93 was within time.

Conclusion: The demand was not time barred and the objection based on limitation failed. The appeal succeeded in favour of the Revenue.

Final Conclusion: The impugned order was set aside because the duty demand could be pursued from the date of finalisation of the provisional assessments, with the result that the Revenue's appeal was allowed.

Ratio Decidendi: Where excise clearances are made under provisional assessment pending final approval, limitation for duty demand runs from finalisation of the assessment and not from the earlier clearance period.

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