2006 (3) TMI 26

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....ust 1998 the assessee intimated the Revenue as regards closure of their cold rolling machines. Intimations to that effect was given to the Revenue. However, the assessee's factory was visited by the Central Excise officers on 1-9-98 and it was noticed that the said assessee was undertaking manu- facture of Aluminium circles and some stock of rolled sheets was also lying therein. Scrutiny of the private records reflected manufacture of aluminium circles and their clearance without payment of duty, though the appellant had declared the factory to be closed and had filed Nil RT 12 returns during the relevant period. Further, scrutiny of private records revealed that raw material was being regularly purchased and sale bills were raised for the ....

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....rcles cleared by them during the said period were not sold but they only raised labour charge bills to the persons who had supplied for conversion into circles. 5. The appellate authority has merely dropped the demand on the basis of time barred. For better appreciation we reproduce para 9 and 10 of the said order. "I find that there is sufficient evidence on record, also submitted be fore the adjudicating authority, that appellants had kept department in formed of the closure for repair of the cold rolling machine installed in their unit and, therefore no duty liability was attracted under the compounded levy scheme, This information was repealed each month. Also, there is evidence on record that appellants have filed nil return during t....

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....ve to be considered as having been manufactured by the assessee and not by the raw material supplier, in which case assessee was duty bound to discharge their duty liability on the same. Admittedly, the said fact was never disclosed to the Revenue, in which case the assessee cannot claim any bona fide on its part so as not to invoke the longer period against them. In fact entire case of the Revenue is that the respondents wrongly informed the revenue about the closure of their factory whereas they were actually working and pro excisable goods. This reflects upon the mala fide of the assessee. As such we are of the view that dropping of demand on limitation by the Commissioner (Appeals) is not correct and warranted. We, accordingly, set asid....