Full Judgment
Briefly stated facts of the case are as follows : 1.2 The respondents herein, a manufacturer of aerated waters, filed a classification list effective from 1-4-1987 claiming the benefit of exemption as provided to SSI units under Notification 175/86 (as amended). The said classification list was approved on 5-6-1987 by the Assistant Collector vide his Order-in-Original No. 18/Val/1987, dated 5-6-1987 wherein it was held that since the unit was not registered as a Small Scale Industries with the Director of Industries, the benefit of Notification 175/86-C.E., dated 1-3-1986 (as amended) could not be extended. The classification list was accordingly approved and the respondents herein were asked to pay duty on the goods cleared w.e.f.
1-4-1987 at the tariff rate.
1.3 Since they did not pay the duty as demanded in the said order-in-original, the Superintendent of Central Excise concerned vide his letter dated 9-6-1987 reminded the respondents herein to pay duty in pursuance of the order-in-original passed by the Assistant Collector, as mentioned above. The respondents even then did not comply with the order-in-original passed by the Assistant Collector.
Thereafter the Superintendent of Central Excise made the assessment on the relevant RT 12 Return on 9-6-1987 in pursuance of the order-in-original. Assessment so made by the Superintendent of Central Excise on RT 12 was also not complied by the respondents herein. A show cause notice was thereafter issued by the Revenue on 9-5-1988 asking them to show cause as to why the said duty of Rs. 7,41,210/- be not recovered from them. Against the said show cause notice, order-in-original passed by the Assistant Collector on 2-11-1998 was issued confirming the demand of the said amount and directing the respondents to pay the said duty.
1.4 On appeal against the said order-in-original the lower appellate authority has held that the show cause notice dated 9-5-1988 for recovery of duty for the period 1-4-1987 to 14-6-1987 was barred by time. Letter dated 9-6-1987 issued by the Superintendent of Central Excise was not treated as a proper show cause notice by the concerned lower appellate authority. Hence this appeal by the Revenue.
2.1 Learned JDR, Shri R.S. Sangia submits that the show cause notice dated 9-5-1988 was not really necessary inasmuch as the earlier order-in-original dated 5-6-1987 approved the classification list of the respondents herein denying them the benefit of Notification No.175/86-C.E. The said order-in-original also demanded the duty inasmuch as the clearances were provisional pending approval of the classification lists. This order-in-original has become final inasmuch as the respondents herein have not challenged the said order-in-original. Once the classification list has been approved well in time and the demand of duty has also been confirmed against the respondents, the action of issuing a second show cause notice as made by the department on 9-5-1988 was not at all called for. RT 12 assessments were also made by the Superintendent of Central Excise in pursuance of the said order-in-original dated 5-6-1987. In the aforesaid circumstances there was no need to issue a separate show cause notice for recovery of demand of duty inasmuch as it was in pursuance of the approval of classification list vide order-in-original dated 5-6-1987 read with RT 12 assessment dated 9-6-1987 when the demand has arisen. He, therefore, submits that the demand cannot be held to be barred by time and hence he prays for allowing the appeal of the Revenue.
3.1 On the other hand, learned Advocate, Shri A.K. Jain in the written submissions has submitted that the appeal is not maintainable in view of the fact that no authority by the Commissioner in favour of the Deputy Collector (Audit), Central Excise, Kanpur has been submitted with the appeal. This plea of the respondents herein is not maintainable. We have seen the authority dated 30-3-1992 given by the Collector of Central Excise, Kanpur in favour of Deputy Collector (Audit), Central Excise, Kanpur.
3.2 Another plea taken by the Advocate is that the show cause notice dated 9-5-1988 is unsigned. This plea is not sustainable because the copy of the show cause notice available on the file indicates that Superintendent of Central Excise, Range Agra has signed the show cause notice and an attested copy thereof has now been submitted by the Superintendent of Central Excise (Review). In view of the marking that the show cause notice is "Sd/-" it cannot be treated to have be an unsigned show cause notice. In any case such a plea of fact was not taken before the original authority and the lower appellate authority and this plea cannot be allowed to be taken at this stage.
3.3 Next plea is that the show cause notice having been issued by the Superintendent of Central Excise and invoking a period exceeding six months is an incompetent show cause notice. Another plea of the learned Advocate is that the letter dated 9-6-1987 cannot be treated as a show cause notice under Section HA ibid. It is also submitted that the application of SSI registration was made on 3-3-1987 whereas the SSI registration was done on 2-9-1987. It is, therefore, pleaded that the SSI registration has to be deemed to have been effective from the date of making of application therefor. In support of this plea the judgments in the following cases have been relied upon : 4.1 We have carefully considered the pleas advanced from both sides. As rightly pointed out by the learned JDR, Shri R.S. Sangia, classification list was approved by the Assistant Collector within a period of two months and 5 days by his order-in-original dated 5-6-1987. Since the clearances had been made pending approval of classification list, he also directed the respondents herein to pay the duty for the period effective from 1-4-1987. This order-in-original is a statutory order and has not been challenged by the respondents so far. In pursuance of this order the Superintendent of Central Excise concerned made RT 12 assessments denying the benefit of exemption Notification No. 175/86-C.E. The said order-in-original dated 5-6-1987 passed by the Assistant Collector has become final having not been challenged by the respondents herein. They were, therefore, duty bound to comply not only with that statutory order but also with the assessments made in pursuance of that order. There was no need for a separate show cause notice in the facts and circumstances of this case as done by the department On 9-5-1988. In these circumstances, it cannot be held that the demand of duty in any manner is barred by time inasmuch as the demand had been made well within the period of six months immediately on finalisation of the classification list by the Assistant Collector vide his order dated 5-6-1987. The citations relied upon by the respondents learned Advocate in his written submissions for the demand being time barred do not apply to the facts and circumstances of this case inasmuch as the show cause notice dated 9-5-1988, as already stated, was not really called for. As regards the plea that the respondents had applied for the SSI registration on 23-3-1987 and therefore, the registration certificate given to the respondents on 2-9-1987 should be taken to have been given retrospectively w.e.f. 23-3-1987, we observe that the various citations quoted by the learned Advocate are on the peculiar provisions of Sales Tax Laws or on the ground that granting of a certificate is only a technical formality. We observe that in the context of Notification No.175/86-C.E. availability of registration certificate, with the SSI authorities is a mandatory condition and it cannot be termed as a' mere technical formality; nor can the certificate be treated to be applicable from the date of application i.e. 23-3-1987 in the absence of any provisions to that effect. Had that been the intention in the notification, the notification would have given the condition of making an application for registration with the SSI authorities and not the registration of the unit with the SSI authorities. In the cases in which it has been held by the various Courts in the judgments relied upon by the learned Advocate that the date of granting of certificate should be given retrospective effect from the date of making application are not applicable to the facts and circumstances of this case inasmuch as in all those cases the certificate was to be granted by the concerned Sales Tax authorities whereas in the present case the certificate was to be granted by another authority and not the Central Excise authorities. Further as already stated the notification itself states that the unit should be registered with the Directorate of Industries or other concerned authority before the benefit of exemption notification can be granted.
5.1 In view of the foregoing, we set aside the impugned order and allow the appeal of Revenue.