HINDUSTAN ZINC LTD. Vs. CCE, JAIPUR

JUDGEMENT

(1.) WHEN the petition for stay came up for hearing, it was felt that the appeal itself can be disposed of, in view of the nature of the issue involved. We, therefore, proceed to dispose of the appeal. The appellant is engaged in the manufacturer of lead, Zinc, Cadmium, and other non -ferrous metals and their by -products. The appellant has got various mining units, where lead and Zinc Ore are being excavated and the same is concentrated at the Concentration Plants located just above the mines. The concentrated ore so obtained is transferred to the Smelters of the appellant, where the above final products are being smelted/manufactured out of such concentrates. The demand under the show cause notice dated 20.7.2001 is for the period July, 1996 to March 1997. The dispute relates to the computation of the assessable value of the goods transferred to the Smelters. According to the appellant the value of concentrate is being arrived at the assessable value by taking into consideration the cost of production of mines and adding 10% of manufacturing profit as per the balance sheet of the respective mining unit of the immediately preceding year. According to the Department the 10% notional profit added cannot be accepted. The Revenue would contend that a profit at the rate of 24.30% should have been added since that was the profit worked out from the Audited Balance -Sheet of the Unit for 1996 -1997.

(2.) APART from the contentions raised on merits, the appellant submits that the entire demand is barred by limitation. The appellant points out that as early as on 15.1.1997 the appellant had provided the required information regarding the mining in which the assessable value of concentrate was being arrived at by the appellant, namely, by taking into consideration the cost of production of mines and adding 10% notional profit to the same. We find that such a statement had been given by the appellant as any other information relevant to pricing the marketing system as per annexure to the declaration under sub -rule 3A of Rule 173 -C filed on 15.1.1997. The learned Departmental Representative has submitted that the above declaration is not relevant for the purpose of declaration regarding pricing. Therefore, according to him, the contention of the assessee that there was no suppression of facts, cannot be accepted. We find merit in the contention raised by the appellant. The relevant facts required for arriving at the assessable value as computed by the assessee had been made available to the Department in the above -mentioned statement filed on 15.1.1997. Since the relevant facts are brought to the notice of the Department, there was no merit in the contention that the statement is not relevant for the purpose of declaration regarding pricing. What is relevant is whether the required information was brought to the notice of the Department or whether the assessee had suppressed the relevant information. In the facts of the case, we find that there was no suppression of the material facts by the assessee. Under these circumstances the demand in the show cause notice dated 20.7.2001 is clearly barred by limitation. We, therefore, set aside the impugned order and allow the appeal as well as Stay Application.