SAIL Vs. COMMISSIONER OF CENTRAL EXCISE, BBSR-II

JUDGEMENT

(1.) Heard both sides. The appellants filed this appeal against the impugned order whereby the demand of Rs. 14,84,656/ - was confirmed for invoking the extended period of limitation and a penalty of Rs. 50,000/ - was imposed on the appellants under Rule 173Q of the Central Excise Rules, 1944. A demand for interest was also made in the adjudication order. The only contention of the appellants is that six show -cause notices were adjudicated by the impugned order and the demand in respect of show -cause notice issued on 22 -2 -99 for the period November, 1996 to November, 1998 where the suppression with intent to evade duty was alleged against the appellants is time barred. The contention is that the appellants are engaged in the manufacture of various iron and steel products and were making representations to the Board of the Central Excise and Customs for reconciliation of the stock in the stockyard and pursuant in the representation made, the Board issued a Circular dated 23rd September, 1999 whereby the special procedure of excess/shortages of iron & steel products at the stockyard/depots of integrated steel plants/consignment agents, was prescribed. In pursuant to this Boards Circular, the excess and shortages of the stockyard were reconciled. The present demand is in pursuant to the procedure specified under above Circular. The contention is that as the Revenue was aware that there was certain shortages and excess in the stockyard, therefore, the allegation of suppression is not sustainable and the demand beyond the normal period of limitation is barred by limitation.

(2.) THE appellants also submitted that the demand of interest is made without mentioning of any Section of the Act in the impugned order. The contention is that during the relevant period, the provision of Section 11AB of the Central Excise Act, provides that the interest is payable in case of suppression/collusion etc. and the provision further amended w.e.f. 11 -5 -2001 whereby interest was levied in respect of delayed payment of duty. The contention is that as the demand under show -cause notice dated 22 -2 -99 is barred by limitation, therefore, they are only liable to pay interest w.e.f. 11 -5 -2001.

(3.) THE contention of the Revenue is that the appellants were getting regular monthly stock/sale statement from the stockyard reflecting excess quantity on consignment -to -consignment basis, but this fact was not disclosed to the jurisdictional Excise Officers. Therefore, the demand for invoking the extended period of limitation is sustainable. In respect of the interest, the contention is that as the duty was paid after the due dates the interest is leviable.