Judgment:
1. These appeals, arising in a second round of litigation, are directed against an order passed by the Commissioner pursuant to this Tribunal's remand order (Final Order Nos. 1406 to 1408/2000 dated 6-10-2000), whereby the Commissioner was directed to pass a fresh order giving findings on all issues including limitation. The impugned order is in de novo adjudication of a Show Cause Notice (SCN) dated 28-4-1997, wherein a demand of duty had been raised on M/s. Ranka Wires Pvt. Ltd. (RWPL, for short) for the period 1992-93 to 95-96 by clubbing their clearances of excisable goods with those of M/s. Insulated Wires Mfg.
Co. (IWMC, for short) and M/s. Ranka Alcop (RA, for short) for the purpose of computing aggregate value of clearances of M/s. RWPL under Notification Nos. 175/86-C.E. and 1/93-CE., and a penalty was proposed on M/s. RWPL under Rule 173Q of the Central Excise Rules, 1944. The SCN had invoked the larger period of limitation under Section 11A of the Central Excise Act, alleging that the three units had wilfully suppressed before the department material facts relevant to clubbing of their clearances.
2. The impugned order confirmed a demand of duty of Rs. 32,34,484/-against M/s. RWPL and imposed on them a penalty of Rs. 10 lakhs.
3. In these appeals, the appellants have contested the demand of duty on RWPL by challenging the clubbing of clearances and pleading time-bar.
4. Heard both sides. Ld. Counsel for the appellants did not press the challenge against clubbing of clearances of the three units. However, he set up a serious challenge against the demand of duty on the ground of limitation. It was submitted that all the three units had filed classification lists with the department for the relevant period and that, in those lists, they had specifically declared that they did not have any proprietary interest in any other factory in the production of excisable goods. Ld. Counsel pointed out that this declaration had been verified and found correct by the Inspector of Central Excise and the Superintendent of Central Excise of the Range concerned and that, as recommended by the Superintendent, the Asst. Collector of Central Excise of the Division concerned had approved the classification lists.
Ld. Counsel referred to the relevant approved classification lists available on record and argued that the department was estopped from alleging that the appellants had suppressed material facts. In this connection, he relied on the following decisions of the Tribunal :-JKS Fibre Glass Pvt. Ltd. v. CCE, Calcutta-I, 2001 (137) E.L.T. 436 (Tri.-Kolkata) (2) Mafatlal Fine Spg. and Mfg. Co. Ltd. v. CCE, Surat, 2001 (127) E.L.T. 171 (Tri.-Mum.) (3) Burroughs Welcome (I) Ltd. v. CCE, Mumbai-III, 2000 (124) E.L.T. 522 (T.)Manali Petrochemicals Ltd. v. CCE, Chennai, 2004 (167) E.L.T. 434 (T) : 2004 (61) RLT 73 (CESTAT- Che.) 5. Referring to the Commissioner's finding that, as the non-payment of job charges by one unit to another had not been disclosed to the department, there was suppression on the part of RWPL and, consequently, the larger period of limitation was invocable against them, learned advocate submitted that it was not a legal requirement for M/s. RWPL to disclose to the department any nonpayment of job charges. It was argued that non-disclosure of a fact which was not required by law to be disclosed would not amount to suppression. In this connection, reliance was placed on the Tribunal's decision in Gufic Pharma Pvt. Ltd. v. CCE, Vadodara, 1996 (85) E.L.T. 67 (Tri), wherein it had been held that failure to disclose details about the financing of the units did not attract the extended period of limitation under Section 11A as there was no provision of law which required that the source of finance should be declared to the department. Ld. Counsel pointed out that the Civil Appeal filed by the department against the Tribunal's decision in Gufic Pharma (supra) was dismissed by the Apex Court [1997 (93) E.L.T. A186 (S.C.)]. Finally, it was submitted that the entire demand of dutv raised on M/s. RWPL in the impugned order was hit bv limitation as the extended period of limitation under Section 11A of the Central Excise Act was not invocable against them in the absence of suppression of facts.
6. Ld. SDR submitted that, at any point of time, the appellant-units had not disclosed their inter-relationship to the department. Where the clubbing of clearances was conceded, there was implicit suppression, before the department, of material facts relating to such clubbing.
Therefore, SDR argued, the larger period was applicable to the case.
Ld. SDR relied on the Supreme Court's decision in CCE, New Delhi v.Modi Alkali & Chemicals Ltd., , wherein it was held that the extended period of limitation was clearly applicable on the facts of the case, as suppression of material features and factors had been clearly established. Reliance was also placed on the Tribunal's decision in Pahwa Chemicals Pvt. Ltd. v. CCE, Delhi-II, 2002 (142) E.L.T. 106 (Tri.-Del.), wherein a finding of suppression of facts was upheld by the Tribunal after observing that use of brand name of another person had not been disclosed by the assessee in their classification list or RT-12 Returns or during stock verification by Central Excise officers and, accordingly, the extended period of limitation was held to be applicable.
7. After careful consideration of all the submissions, we find that the appellants have conceded the Commissioner's findings on the merits of the case. The only subsisting challenge to the demand of duty is on limitation. We have perused the relevant classification lists filed by the various units. In the classification list filed by M/s. RA, effective from 4-3-1994, they had declared thus "we do not have proprietary interest in any other factory in the production of excisable goods". They had tendered a similar declaration in their classification list, effective from 1-4-1993, and also in their earlier classification list effective from 11-1-1993. We have also come across similar declarations in the classifications lists of M/s. IWMC filed in April 1992, December 1993 & March 1994. These classifications lists were duly verified by the Central Excise Range Superintendent and recommended for approval, and the jurisdictional Asst. Collector approved the same. In so far as clubbing was concerned, whether one unit had any proprietary interest in the other was a material question of fact. M/s. RA & M/s. IWMC declared to the department as early as in 1992, 1993 & 1994 that they had no proprietary interest in any other factory and this declaration was accepted by the department after due verification. Thus, the department was aware of the fact that each of the units, viz. M/s. RA & M/s. IWMC had no proprietary interest in any other factory in respect of manufacture of excisable goods. Hence the allegation that the appellants had suppressed facts relating to clubbing of clearances cannot be sustained. The case law cited by learned advocate goes to support this view. In the cases of JKS Fibre Glass Pvt. Ltd. (supra), Mafatlal Fine Spg. & Mfg. Co. Ltd. (supra) and Burroughs Welcome (I) Ltd. (supra), the larger period of limitation was held not to be invocable as the classification lists filed by the assessees had been approved by the department without objection. In the case of Manali Petrochemicals (supra), the assessee had filed declaration and price lists periodically which had been approved by the department and, in these circumstances, it was held by the Tribunal that the appellants had not suppressed any information from the department and, therefore, the larger period of limitation was not invocable against them. We find that one of the elements of suppression found by the Commissioner pertains to non-payment of job charges by one unit to the another among the three units. The Revenue has not shown that disclosure of such financial matters by an assessee to the department was a legal requirement during the material period. In the circumstances, the Tribunal's decision in Gufic Pharma (supra), affirmed by the Apex Court, would work in favour of the appellants.
Accordingly, we hold that non-payment of job charges by any of the appellant-units to the department would not amount to suppression of fact attracting the larger period of limitation. The cases cited by ld.SDR are distinguishable. In the result, the appellant's plea of time-bar succeeds. Accordingly, we vacate the demand of duty as time-barred. Consequently, the penalty on M/s. RWPL also gets set aside.
(Operative part of the order was pronounced in the open Court on 10-2-2005.)