1. This appeal is directed against Order No. 28/89, dated 20-10-1989 passed by the Additional Collector of Central Excise, Nagpur.
2. The appellants are engaged in the manufacture of evaporative coolers classifiable under Chapter Heading 84.15 of the CET. They claimed benefit of exemption under Notification No. 65/83 dated 1-3-1983. This notification exempts the impugned goods among others up to 15 lakhs cleared on or before 1st of April in any Financial Year and exemption, however, is dependent on the assessee's filing a declaration with the Assistant Commissioner to the effect that aggregate value of clearances of the specified goods would not exceed Rs. 15 lakhs.
3. The Additional Collector held that the aggregate value of clearances had exceeded Rs. 15 lakhs and they had not filed necessary declaration.
4. Arguing for the appellants, learned Advocate submits that the notification during the Financial Year 1986-87 was rescinded on 23-4-1986. In other words, the benefit of this notification was available from 1-4-1986 to 23-4-1986 and during this period they cleared the goods valued at Rs. 9 lakhs. Since this notification was rescinded on 23-4-1986 the condition attached to this ' notification was not available after it was rescinded. It is true that subsequent to this date they effected clearances of specified goods and when such clearances are added to the clearances made during the period 1-4-1986 to 23-4-1986 the value would exceed Rs. 15 lakhs. However, the value specified in Notification No. 65/83 could not be clubbed with the value of the goods cleared subsequent to the date on which the notification was rescinded. In regard to declaration he submits that it was filed in November, 1985 and. there was no requirement that declaration should be filed along with the classification lists year after year. Apart from this, he submits the details about the assessment of RT12 returns and pointed out that show cause notice for the period 1-4-1986 to 23-4-1986 was issued only on 26-8-1988 and, therefore, the demand was clearly barred by time.
5. Learned D.R. submits that the declaration ought to have been filed along with the classification lists and is required to be filed for each financial year since the exemption is for a financial year.
Countering the argument on limitation he submits that they did not file the declaration and, therefore, had they filed such declaration the department would have been in a position to detect the irregularity well in time.
6. We have heard both the sides. Without going into the merit of the case, we are of the view that demand is clearly time barred. On going through the details of assessed RT 12 returns, we find that RT 12 returns were assessed up to March, 1987. March 1987 RT 12 has been assessed on 31-12-1987. RT 12 return for April, 1986 on which the concessional assessment was made obviously would have indicated the payment of duty at the reduced rate. It is, therefore, clear that as early as in 1986 they had disclosed the fact of claiming exemption and the departmental officers in assessing such return in February, 1987 are expectred to have known that this benefit was being claimed.
Therefore, there could not be any suppression of fact in regard to the claim of exemption. The show cause notice dated 26-8-1988 proposing demand of duty for the period 1-4-1986 to 23-4-1986 is, therefore, clearly hit by limitation.
7. In view of this, without going into the merit of the case, we set aside the impugned order and allow the appeal on the limited question of limitation.