TaxTMI 
TaxTMI 
1995 (5) TMI 113
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....1978 to 22-10-1982. He has also held that part demand for Rs. 1,90,400.82 for the period from 1-3-1982 to 31-7-1982 demanded by show cause notice dated 23-11-1982 is also hit by time bar for a part period from 25-5-1982 to 31-7-1982. Therefore, the ld. Collector has modified the demand to this extent. The ld. Collector has totally set aside the demands raised in the show cause notice dated 25-1-1983 for Rs. 8,07,039.87 issued for the period from 1-4-1977 to 31-3-1978 as totally barred by time. Aggrieved by this order, the Revenue has filed this appeal. The respondent has also filed cross appeal for confirmation of duty for part period. 3. It is stated in this appeal that the product in question has been found as `rigid' plastic, vide chemical test, and hence it is pleaded that the Notification No. 231/82 issued on 23-10-1982 and Notification No. 208/84 has no role to play. The respondent had not filed classification list nor obtained any licence for removal of the goods on payment of duty and hence the demand made for extended period is not barred by time. 4. In the cross appeal, the respondent has stated that they are manufacturers of Low Density Polyethylene and P....
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....o, if an intermediate product like lay flat tubing arises. He submitted that the Section 11C notification exempted only prospectively and hence the demands for larger period and six months prior to the issue of the show cause notice are demandable, as also because the party had failed to obtain licence being asked to do so. In this regard, he relied on the ruling rendered in the case of Vishwakarma Steel Ind. v. C.C.E. as reported in 1986 (26) E.L.T. 169. In this case, it has been clearly laid down that obtaining licence is a different aspect than dutiability and failure to do so would entail attraction of larger period. Ld. SDR fairly admitted that in this case no notice had been issued calling upon them to obtain licence. However, after the issue of first SCN, they were bound to have taken the licence and as they had failed to do so, demands for larger period are extendable. 6. The Learned Consultant, Shri R.K. Jain arguing for the respondent submitted that the demands were barred by time. The department had issued two show cause notices, one dated 6-11-1982, for an amount of Rs. 1,90,400.82 for the period 1-3-1982 to 31-7-1982. Thereafter the department had issued notice....
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....on 15-7-1982 and, therefore, the question of suppression did not arise in this case. In this regard, he relied on the ruling rendered in the cases of :- i. Dr. Beck & Co. (India) Ltd. v. Collector of Central Excise; [1991 (54) E.L.T. 271] ii. Dimensional Plastics Industries (P) Ltd. v. Collector of Central Excise; [1991 (54) E.L.T. 443] iii. S.B.L. Ltd. v. Collector of Central Excise; [1994 (74) E.L.T. 350] He submitted that if the department remained silent for a long time, even after information had been furnished, then in that event, the Tribunal has held that the larger period cannot be invoked as in the case of S.K. Kemexc Industries v. Collector of Central Excise as reported in 1995 (75) E.L.T. 377. He submitted that the assessee had not paid the duty, as there was a general practice in the trade to consider the goods as exempted and, therefore, the assessee had held a bona fide belief. Such a belief can also be inferred from the circumstances of issue of Notification under Section 11C by the Government. In this regard, he submitted that the Tribunal in a series of judgments has held that, where a notification under Section 11C has been issued then in that event, ....
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....as a modulus of elasticity either in flexture or in tension of not over 700 kilograms per square centimetre at 23 degrees centigrade and 50 per cent relative humidity when tested in accordance with the method of test for stiffness of plastics (ASTM Designation D-474-63), for flexural properties of plastics (ASTM Designation D-790-63), for Tensile properties of plastics (ASTM Designation D-638-64T), or for Tensile properties of Thin Plastic sheeting (ASTM Designation D-882-64T); (ii) the expression "rigid", in relation to an article made of plastic, means all articles other than `flexible' articles as defined in clause (i). (Notification No. 68/71-C.E., dated 29-5-1971 as amended by Notifications No. 195/77-C.E., dated 23-6-1977 and No. 198/78-C.E., dated 25-11-1978." Referring to this notification the Learned Consultant submitted that only those articles of plastics arising from the Item No. 15A(1) were exempted, provided their flexibility satisfied the expression "flexible" as defined in the notification. He submitted that both the criterions had not been shown by the department, to have not been satisfied by the party. He submitted that the party had always contende....
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....lit to obtain sheets and hence, such splitting did not amount to manufacture. 9. As can be seen from the allegations made in the show cause notices, it is department's case that the party is manufacturing low density films and sheets from polyethylene and polyproplyene granules. Therefore, the question of considering whether lay flat tubings arose as a result of splitting and as to whether it amounts to manufacture does not arise for our consideration. The reason being, even if such lay flat tubings arose during the intermediate stage, yet the department is not choosing to classify such lay flat tubings and no such allegation is made by the department that such an intermediate product arose during the manufacture of films and sheets from granules, and were required to discharge duty. Therefore, it is not necessary for us to examine this issue in the light of controversy raised by the department. However, the plea of rigidness raised by the department is an important criterion for our examination. The Notification No. 208/84-C.E., dated 16-10-1984 exempted the duty for the past period, it was issued under Section 11C and it laid down that polyethylene films all sorts, of thi....
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....arred is also relevant to the present case. It is also seen that the department has not alleged the details of suppression nor shown that the appellants have evaded duty with an intention to evade duty, which now the Supreme Court has held to be a requirement, for confirming demands for larger period as held in the case of Cosmic Dye Chemical v. Collector of Central Excise, as reported in 1995 (75) E.L.T. 721. It is also seen that the test results are said to have been obtained by the department on 15-7-1982. Therefore, the issue of show cause notice on 25-1-1983 invoking larger period after a lapse of time is also clearly barred by time. In this regard, the ruling referred to by the Learned Consultant before us supports our view. 10A. In the result the respondent succeeds both on merits as well as on time bar and thus, the appeal of the Revenue is rejected. 11. [Assent per : S.K. Bhatnagar, Vice President]. - With due respects to Hon'ble Member (Judicial), my views and orders in the matter are as follows :- 12. I have considered the submissions of both the sides including the written memo dated 22-2-1995. 13. The basic question involved in this case is a....