Collector of C. Ex. Vs. Sri Chamundeswari Sugars Ltd. - Court Judgment

Excerpt:
1. by the present appeal, the appellant has assailed the order of collector (appeals). the collector (appeals), in his order, had held : "6. the above mentioned para means that all the notifications are not applicable. as it has stated that sugar not covered by notification nos. 35/76 and 210/73 and its successor notifications are to be demanded in terms of section 11 a. therefore, when all these notifications are held to be not applicable, the rate for free sale sugar can only be applicable as it existed at the relevant period. that is also the subject of the earlier show cause notices. therefore, the order of the assistant collector that rates under notification no. 35/76 are applicable is not in pursuance of these show cause notices because the ground is completely different. however, this show cause notice is more or less a repetition of the earlier two show cause notices, except there is some discrepancy in the period of demand. i find that the appellant's contention that this show cause notice issued under section 11a is time barred is quite correct. this notice was issued on 28-3-1984 and the period of demand covered in this show cause notice is 28-7-1977 to 15-8-1978. even from the last date, i.e. 15-8-1978, the show cause notice is issued beyond a period of five years and therefore, this show cause notice is not a valid show cause notice under section 11a under which it has been issued and no demand can be sustained on the basis of this notice. therefore, this notice can be straightaway ignored. 7. coming to the other notices, the first show cause notice is in time as it was issued on 25-10-1977 covering the period july and august, 1977. the other show cause notice is partly time barred. however, that is of no consequence because the impugned order is not in pursuance of the ground on which the appellants were asked to show cause in these two show cause notices. in these two notices, appellants were asked to show cause as to why the rate of duty applicable to free sale sugar should not be adopted and differential duty paid by them. in the impugned order, the assistant collector has accepted that rate of duty prescribed by notification no. 35/76 is to be adopted. the order being not in pursuance of grounds of these two show cause notices, cannot be held to be correct. in consequence, the order is without a show cause notice. therefore, the entire demand is not sustainable under law. the same is set aside and the appeal allowed." 2. the facts of the case are that the respondents herein are engaged in the manufacture of sugar. they had started availing concessional rates of duty for the sugar produced by them under notification no. 35/76 w.e.f. 28-7-1977. the respondents herein produced a certificate issued by the directorate of sugar, new delhi on 22-7-1977. the respondents herein availed concession for the period 28-7-1977 to 15-8-1978 and paid central excise duty at rates applicable to levy sugar under notification no. 210/73 and its successor notifications viz.notification nos. 223/76, dated 3-8-1976, 226/76, dated 6-8-1976, 251/76, dated 14-9-1976, 254/76, dated 21-9-1976, 279/76, dated 22-11-1976 and 317/77, dated 16-11-1977. the department alleged that the concession under the afore-mentioned notifications was not correctly availed of by the respondents herein. two show cause notices were issued. the first show cause notice was issued on 25-10-1977 and the second show cause notice was issued on 12-3-1979 asking the respondents herein to explain as to why duty amounting to rs. 37,17,536.79 for the period 1-7-1977 to 31-8-1977 and duty amounting to rs. 37,08,163.46 for the period 1-10-1977 to 30-6-1978 should not be recovered from them under rule 10 read with rule 173j of the central excise rules, 1944. a third show cause notice was issued on 28-3-1984 by assistant collector. the allegation was that as the respondents herein had availed concession under notification no. 210/73, dated 15-12-1973 and its subsequent notifications, therefore, the respondents herein were not eligible to get the benefit of notification no. 35/76, dated 22-2-1976 for the period between 22-7-1977 and 15-8-1978 in view of the proviso to notification no. 35/76. the assistant collector, in his order, had held that the respondents herein are eligible for benefit under notification no. 35/76 from the date of commencing availment of benefit by the company that is 28-7-1977 till 15-8-1978 upto which date the notification no. 35/76 was in force. the assistant collector also held that the respondents herein are not eligible for concessional rates of duty in respect of clearance of levy sugar from their factory under notification no. 223/76, 226/76, 279/76, 251/76 and 317/77 for the period from 28-7-1977 to 15-8-1978 because during the period, the respondents herein were availing the benefit under notification no. 35/76. the assistant collector also held that the respondents herein are liable to pay a total duty of rs. 17,92,849.72 being the differential duty between the duty payable and paid on the sugar cleared by them at the rate prescribed in notification no. 35/76.3. against this order of the assistant collector, the respondents herein filed an appeal with the collector (appeals) who held as indicated above.4. against this order of the collector (appeals), the department has filed the present appeal.5. shri a.k. madan, the learned sdr appearing for the appellant submitted that show cause notice dated 25-10-1977 for the period 1-7-1977 to 31-8-1977 and show cause notice issued on 12-3-1979 for the period from 1-10-1977 to 30-6-1978 are within the time as they have been issued according to the directions made by the range superintendent in the relevant rt-12 returns; that the directions so made are valid demands and that show cause notice was issued in furtherance of the directions made in rt-12 returns; that this tribunal in some cases has already held that show cause notices issued in furtherance of such demands are valid. the learned sdr therefore, submitted that the decision of the assistant collector was right in holding that the demands were within time. the ld. sdr also submitted that show cause notice dated 28-3-1984 was not a new show cause notice but was only an addendum and therefore, it was a valid show cause notice; that the decision taken by the assistant collector is based on the allegations indicated in the show cause notice dated 28-3-1984. the ld. dr therefore, submitted that the order-in-appeal is erroneous and may be set aside.6. shri v. sridharan, the learned counsel for the respondents submitted that the respondents are engaged in the manufacture of sugar; that they were availing under notification no. 210/73 and thereafter the succeeding notification nos. 223/76, 226/76, 251/76, 279/76 and 317/77.the ld. counsel submitted that the respondents herein were also availing the benefit of notification no. 35/76; that the superintendent while assessing the rt-12 returns made endorsement reading as "as your factory has already availed notification no. 210/73, dated 15-12-1973 and other successor notifications, therefore, concession under notification no. 35/76 is not applicable to your factory"; that in reply to the show cause notices, the respondents herein submitted that they had not contravened the proviso to notification no. 35/76; that the respondents after receipt of provisional certificate dated 22-7-1977 became entitled to the concession under notification no.35/76; that notification no. 210/73 had been superseded by notification no. 223/76, dated 3-8-1976; that notification no. 210/73 was not in existence when the respondents herein started availing benefit under notification no. 35/76, therefore, the question of availing concession under that notification or contravention of provisions under notification no. 35/76 does not arise; that fresh show cause notice was issued by a.c. on 28-3-1984; that in this notice, the demand was proposed on the following counts : (a) benefit of notification nos.223/76, 226/76, 251/76, 317/77 is not available and (b) benefit of notification no. 35/76 is not available inasmuch as the benefit of notifications 223/76,226/76, 251/76 and 317/77 were availed which was a successor of notification no. 210/73. the ld. counsel submitted that the point (a) was raised for the first time in the show cause notice issued on 28-3-1984; that the respondents herein specifically pointed out that the proposal in this notice to deny the benefit of notification nos. 223/76, 226/76, 251/76 and 317/77 was not taken in the show cause notices issued by the superintendent on 25-10-1977 and 12-3-1979; that since the proposal to deny these notifications has been raised for the first time in the show cause notice dated 28-3-1984 which is beyond five years, the demand was time barred; that the assistant collector adjudicated the three show cause notices holding that benefit of notification no. 35/76 is available till 15-8-1978; that benefit of notification nos. 223,226,279,251 (all of 1976) and 317 of 1977 is not available; that a.c. also demanded a differential duty; that the respondents filed an appeal before the collector (appeals); that the collector (appeals) held the order of the assistant collector that notification no. 35/76 is applicable and all other notifications are not applicable is not the subject raised in the earlier two notices is not in pursuance of these notices. the ld. counsel pointed out that this finding is contrary to the allegations made in the show cause notice. the ld. counsel submitted that the ld. collector (appeals) further held that the notice issued on 28-3-1984 covering the period 28-7-1977 to 15-8-1978 was issued beyond a period of five years and the demand is therefore, time barred. the ld. counsel submitted that when notification no. 210/73 was effective, they had not started availing benefit of notification no. 35/76. he submitted that notification no.210/73 was superseded by notification no. 223/76 w.e.f. 3-8-1976; that this notification was further superseded by notification no. 226/76 w.e.f. 6-8-1976; that this notification was further superseded by notification no. 251/76 w.e.f. 14-9-1976. he submitted that the respondents' factory commenced the production of sugar for the first time after the 1st day of april, 1974 and had complied with the requirement of the notification. the ld. counsel submitted that the proviso to notification no. 35/76 only states that nothing contained in notification no. 210/73 shall apply to a sugar factory covered by this notification and that subsequent notifications were not covered by this exclusion. he submitted that there has been no contravention of the provisions of notification no. 35/76 and therefore, the benefit has been correctly availed. the ld. counsel therefore, submitted that in view of the correct availment of the benefit under notification no.35/76 and other notifications, the appeal may be rejected.7. heard the submissions of both sides. before we proceed to discuss the case show cause noticeswise, we would like to discuss the implication of the proviso to notification no. 35/76, dated 25-2-1976 vis-a-vis, the notification no. 210/73, dated 15-12-1973. we find that notification no. 210/73 was superseded by notification no. 223/76, dated 3-8-1976. this notification was further superseded by notification no. 226/76. notification no. 226/76 has been further superseded by notification no. 251/76, dated 14-9-1976.8. we observe that in notification no. 35/76, dated 25-2-1976, there was a proviso reading as "provided that nothing contained in the notification of the govt. of india in the ministry of finance, deptt.of revenue and insurance no. 210 of 1973 c.e., dated 15-12-1973 shall apply to a sugar factory covered by this notification." this proviso assumes importance inasmuch as notification no. 210/73 has been superseded by subsequent notifications for different periods. the point agitated before us was that since notification no. 210/73 was superseded by subsequent notifications and no corresponding change was effected in the proviso to notification no. 35/76, therefore, the subsequent notification nos. 223/76, 226/76 and 251/76 shall have to be interpreted independent of notification no. 35/76. the ld. counsel for the appellants submitted that since the superseding notifications were not incorporated by an amendment in the proviso to notification no.35/76, therefore, they cannot be incorporated and read as proviso to notification 35/76, after 3-8-1976. we find that the proviso to notification no. 35/76, dated 25-2-1976 was specific and denied the benefit of the said notification to those availing the benefit of notification no. 210/73, dated 15-12-1973. the admitted position in the instant case was that the first show cause notice covered the period 1-7-1977 to 31-8-1977, therefore, we have to see that during this period which notification was current and whether this notification can be read into the proviso to notification no. 35/76, dated 25-2-1976. we find that on 1-7-1977, notification no. 251/76, dated 14-9-1976 was the succeeding notification of notification no. 210/73, dated 15-12-1973.the basic issue that arises in this case is whether notification no.251/76 could be automatically read in place of notification no. 210/73 in notification no. 35/76, dated 25-2-1976. we find that the proviso to notification no. 35/76 was not amended. we also observe that this proviso specifically provided that if the factory of the appellants was covered by notification no. 210/73 then the notification no. 35/76 shall not be applicable. the proviso read as under : "provided that nothing contained in the notification of the government of india in the ministry of finance (department of revenue and insurance) no. 210/73-c.e., dated 15-12-1973 shall apply to a sugar factory covered by this notification." since the proviso specifically mentions only notification no. 210/73, dated 15-12-1973, the scope of the proviso has to be restricted to the said notification alone. once it is superseded, the scope cannot be extended to a successor notification unless the successor notification makes a specific reference to notification no. 35/76 or vice-versa. the admitted position is that the sugar factory of the appellants is covered by notification no. 35/76.9. we find that there are three show cause notices. the first show cause notice was issued on 25-10-1977 for denying the respondents herein the benefit of notification no. 35/76 on the ground that they had contravened the proviso to the said notification by availing the concession under notification no. 210/73 which was superseded by notification no. 223/76, dated 3-8-1976 and by other succeeding notifications. having regard to our finding in the previous paragraph that the scope of the proviso to notification no. 35/76 is restricted to notification no. 210/73 when it was in force the question of availment of notification no. 210/73 does not arise after 3-8-1976.10. the second show cause notice was issued on 12-3-1979. we find that the proviso to notification no. 35/76 states that the provisions of notification no. 210/73 shall not apply to a sugar factory covered by notification no. 35/76. though the subsequent notifications are in the nature of superseding notifications since the proviso to notification no. 35/76 mentions only notification no. 210/73 its scope cannot be extended to successor notifications.11. the second issue that arose for determination in this case was that the respondents herein contended that the demand was hit by limitation.we find that in this case, the show cause notice was issued on 12-3-1979 for the demand pertaining to the period 1-10-1977 to 30-6-1978. thus the demand was beyond a period of six months. the question is whether the invokation of a longer period is justified in the instant case or not. the department cited a decision of this tribunal in the case of malt co. india (p) ltd. reported in 1986 (26) e.l.t. 627 in which the tribunal held that there is overwhelming authority supporting the contention that the assessment in rt 12 returns are appealable. as-against this, the learned counsel for the respondents submitted that later decisions of the tribunal clearly indicate that a show cause notice is necessary whenever a demand for short levy or non-levy of duty is raised. we find force in the arguments of the learned counsel of the respondents. it is now a well settled proposition of law that every demand for short levy or non-levy can be raised only by issue of show cause notice. in the instant case, the admitted position is that the show cause notice was issued beyond a period of six months. there is no allegation of suppression, fraud or wilful mis-statement. we also observe that first show cause notice was issued on 25-10-1977. therefore, the question of suppression or wilful mis-statement does not arise in this case. in this view of the matter, we hold that duty demanded under second show cause notice issued on 12-3-1979 is time barred.12. the third show cause notice was issued on 28-3-1984. we find that the first contention of the respondents herein on the third show cause notice was that this show cause notice is a fresh show cause notice inasmuch as denial of exemption under notification nos. 223, 226, 251 all of 1976 and 317 of 1977 was introduced for the first time and was not in the first two show cause notices. the ld. counsel submitted that this show cause notice was not only an addendum but a fresh show cause notice; that this show cause notice was issued beyond a period of five years, therefore, it is hit by limitation. we agree with this contention of the ld. counsel for the respondents and hold that this show cause notice is also hit by limitation and the demand raised therein is time barred.13. since we find that the second and third show cause notices are hit by limitation, the charges and demands contained therein do not survive. the proceedings arising therefrom would consequently abate.ordered accordingly. consequential benefits, if any accruing in favour of the respondents herein would be admissible to them in the light of our observations in paragraphs 8 and 9 in relation to the first scn and in accordance with law.

Judgment:
1. By the present appeal, the appellant has assailed the order of Collector (Appeals). The Collector (Appeals), in his order, had held : "6. The above mentioned para means that all the notifications are not applicable. As it has stated that sugar not covered by Notification Nos. 35/76 and 210/73 and its successor notifications are to be demanded in terms of Section 11 A. Therefore, when all these notifications are held to be not applicable, the rate for free sale sugar can only be applicable as it existed at the relevant period. That is also the subject of the earlier show cause notices.

Therefore, the order of the Assistant Collector that rates under Notification No. 35/76 are applicable is not in pursuance of these show cause notices because the ground is completely different.

However, this show cause notice is more or less a repetition of the earlier two show cause notices, except there is some discrepancy in the period of demand. I find that the appellant's contention that this show cause notice issued under Section 11A is time barred is quite correct. This notice was issued on 28-3-1984 and the period of demand covered in this show cause notice is 28-7-1977 to 15-8-1978.

Even from the last date, i.e. 15-8-1978, the show cause notice is issued beyond a period of five years and therefore, this show cause notice is not a valid show cause notice under Section 11A under which it has been issued and no demand can be sustained on the basis of this notice. Therefore, this notice can be straightaway ignored.

7. Coming to the other notices, the first show cause notice is in time as it was issued on 25-10-1977 covering the period July and August, 1977. The other show cause notice is partly time barred.

However, that is of no consequence because the impugned order is not in pursuance of the ground on which the appellants were asked to show cause in these two show cause notices. In these two notices, appellants were asked to show cause as to why the rate of duty applicable to free sale sugar should not be adopted and differential duty paid by them. In the impugned order, the Assistant Collector has accepted that rate of duty prescribed by Notification No. 35/76 is to be adopted. The order being not in pursuance of grounds of these two show cause notices, cannot be held to be correct. In consequence, the order is without a show cause notice. Therefore, the entire demand is not sustainable under law. The same is set aside and the appeal allowed." 2. The facts of the case are that the respondents herein are engaged in the manufacture of sugar. They had started availing concessional rates of duty for the sugar produced by them under Notification No. 35/76 w.e.f. 28-7-1977. The respondents herein produced a certificate issued by the Directorate of Sugar, New Delhi on 22-7-1977. The respondents herein availed concession for the period 28-7-1977 to 15-8-1978 and paid Central Excise duty at rates applicable to levy sugar under Notification No. 210/73 and its successor notifications viz.

Notification Nos. 223/76, dated 3-8-1976, 226/76, dated 6-8-1976, 251/76, dated 14-9-1976, 254/76, dated 21-9-1976, 279/76, dated 22-11-1976 and 317/77, dated 16-11-1977. The department alleged that the concession under the afore-mentioned Notifications was not correctly availed of by the respondents herein. Two show cause notices were issued. The first show cause notice was issued on 25-10-1977 and the second show cause notice was issued on 12-3-1979 asking the respondents herein to explain as to why duty amounting to Rs. 37,17,536.79 for the period 1-7-1977 to 31-8-1977 and duty amounting to Rs. 37,08,163.46 for the period 1-10-1977 to 30-6-1978 should not be recovered from them under Rule 10 read with Rule 173J of the Central Excise Rules, 1944. A third show cause notice was issued on 28-3-1984 by Assistant Collector. The allegation was that as the respondents herein had availed concession under Notification No. 210/73, dated 15-12-1973 and its subsequent Notifications, therefore, the respondents herein were not eligible to get the benefit of Notification No. 35/76, dated 22-2-1976 for the period between 22-7-1977 and 15-8-1978 in view of the proviso to Notification No. 35/76. The Assistant Collector, in his order, had held that the respondents herein are eligible for benefit under Notification No. 35/76 from the date of commencing availment of benefit by the company that is 28-7-1977 till 15-8-1978 upto which date the Notification No. 35/76 was in force. The Assistant Collector also held that the respondents herein are not eligible for concessional rates of duty in respect of clearance of levy sugar from their factory under Notification No. 223/76, 226/76, 279/76, 251/76 and 317/77 for the period from 28-7-1977 to 15-8-1978 because during the period, the respondents herein were availing the benefit under Notification No. 35/76. The Assistant Collector also held that the respondents herein are liable to pay a total duty of Rs. 17,92,849.72 being the differential duty between the duty payable and paid on the sugar cleared by them at the rate prescribed in Notification No. 35/76.

3. Against this order of the Assistant Collector, the respondents herein filed an appeal with the Collector (Appeals) who held as indicated above.

4. Against this order of the Collector (Appeals), the department has filed the present appeal.

5. Shri A.K. Madan, the learned SDR appearing for the appellant submitted that show cause notice dated 25-10-1977 for the period 1-7-1977 to 31-8-1977 and show cause notice issued on 12-3-1979 for the period from 1-10-1977 to 30-6-1978 are within the time as they have been issued according to the directions made by the Range Superintendent in the relevant RT-12 returns; that the directions so made are valid demands and that show cause notice was issued in furtherance of the directions made in RT-12 returns; that this Tribunal in some cases has already held that show cause notices issued in furtherance of such demands are valid. The learned SDR therefore, submitted that the decision of the Assistant Collector was right in holding that the demands were within time. The ld. SDR also submitted that show cause notice dated 28-3-1984 was not a new show cause notice but was only an addendum and therefore, it was a valid show cause notice; that the decision taken by the Assistant Collector is based on the allegations indicated in the show cause notice dated 28-3-1984. The ld. DR therefore, submitted that the order-in-appeal is erroneous and may be set aside.

6. Shri V. Sridharan, the learned Counsel for the respondents submitted that the respondents are engaged in the manufacture of sugar; that they were availing under Notification No. 210/73 and thereafter the succeeding Notification Nos. 223/76, 226/76, 251/76, 279/76 and 317/77.

The ld. Counsel submitted that the respondents herein were also availing the benefit of Notification No. 35/76; that the Superintendent while assessing the RT-12 returns made endorsement reading as "As your factory has already availed Notification No. 210/73, dated 15-12-1973 and other successor notifications, therefore, concession under Notification No. 35/76 is not applicable to your factory"; that in reply to the show cause notices, the respondents herein submitted that they had not contravened the proviso to Notification No. 35/76; that the respondents after receipt of provisional certificate dated 22-7-1977 became entitled to the concession under Notification No.35/76; that Notification No. 210/73 had been superseded by Notification No. 223/76, dated 3-8-1976; that Notification No. 210/73 was not in existence when the respondents herein started availing benefit under Notification No. 35/76, therefore, the question of availing concession under that Notification or contravention of provisions under Notification No. 35/76 does not arise; that fresh show cause notice was issued by A.C. on 28-3-1984; that in this notice, the demand was proposed on the following counts : (a) benefit of Notification Nos.

223/76, 226/76, 251/76, 317/77 is not available and (b) benefit of Notification No. 35/76 is not available inasmuch as the benefit of Notifications 223/76,226/76, 251/76 and 317/77 were availed which was a successor of Notification No. 210/73. The ld. Counsel submitted that the point (a) was raised for the first time in the show cause notice issued on 28-3-1984; that the respondents herein specifically pointed out that the proposal in this notice to deny the benefit of Notification Nos. 223/76, 226/76, 251/76 and 317/77 was not taken in the show cause notices issued by the Superintendent on 25-10-1977 and 12-3-1979; that since the proposal to deny these notifications has been raised for the first time in the show cause notice dated 28-3-1984 which is beyond five years, the demand was time barred; that the Assistant Collector adjudicated the three show cause notices holding that benefit of Notification No. 35/76 is available till 15-8-1978; that benefit of Notification Nos. 223,226,279,251 (all of 1976) and 317 of 1977 is not available; that A.C. also demanded a differential duty; that the respondents filed an appeal before the Collector (Appeals); that the Collector (Appeals) held the order of the Assistant Collector that Notification No. 35/76 is applicable and all other Notifications are not applicable is not the subject raised in the earlier two notices is not in pursuance of these notices. The ld. Counsel pointed out that this finding is contrary to the allegations made in the show cause notice. The ld. counsel submitted that the ld. Collector (Appeals) further held that the notice issued on 28-3-1984 covering the period 28-7-1977 to 15-8-1978 was issued beyond a period of five years and the demand is therefore, time barred. The ld. Counsel submitted that when Notification No. 210/73 was effective, they had not started availing benefit of Notification No. 35/76. He submitted that Notification No.210/73 was superseded by Notification No. 223/76 w.e.f. 3-8-1976; that this Notification was further superseded by Notification No. 226/76 w.e.f. 6-8-1976; that this Notification was further superseded by Notification No. 251/76 w.e.f. 14-9-1976. He submitted that the respondents' factory commenced the production of sugar for the first time after the 1st day of April, 1974 and had complied with the requirement of the Notification. The ld. Counsel submitted that the proviso to Notification No. 35/76 only states that nothing contained in Notification No. 210/73 shall apply to a sugar factory covered by this Notification and that subsequent notifications were not covered by this exclusion. He submitted that there has been no contravention of the provisions of Notification No. 35/76 and therefore, the benefit has been correctly availed. The ld. Counsel therefore, submitted that in view of the correct availment of the benefit under Notification No.35/76 and other notifications, the appeal may be rejected.

7. Heard the submissions of both sides. Before we proceed to discuss the case show cause noticeswise, we would like to discuss the implication of the proviso to Notification No. 35/76, dated 25-2-1976 vis-a-vis, the Notification No. 210/73, dated 15-12-1973. We find that Notification No. 210/73 was superseded by Notification No. 223/76, dated 3-8-1976. This Notification was further superseded by Notification No. 226/76. Notification No. 226/76 has been further superseded by Notification No. 251/76, dated 14-9-1976.

8. We observe that in Notification No. 35/76, dated 25-2-1976, there was a proviso reading as "Provided that nothing contained in the Notification of the Govt. of India in the Ministry of Finance, Deptt.

of Revenue and Insurance No. 210 of 1973 C.E., dated 15-12-1973 shall apply to a sugar factory covered by this Notification." This proviso assumes importance inasmuch as Notification No. 210/73 has been superseded by subsequent notifications for different periods. The point agitated before us was that since Notification No. 210/73 was superseded by subsequent notifications and no corresponding change was effected in the proviso to Notification No. 35/76, therefore, the subsequent Notification Nos. 223/76, 226/76 and 251/76 shall have to be interpreted independent of Notification No. 35/76. The ld. Counsel for the appellants submitted that since the superseding notifications were not incorporated by an amendment in the proviso to Notification No.35/76, therefore, they cannot be incorporated and read as proviso to Notification 35/76, after 3-8-1976. We find that the proviso to Notification No. 35/76, dated 25-2-1976 was specific and denied the benefit of the said Notification to those availing the benefit of Notification No. 210/73, dated 15-12-1973. The admitted position in the instant case was that the first show cause notice covered the period 1-7-1977 to 31-8-1977, therefore, we have to see that during this period which notification was current and whether this notification can be read into the proviso to Notification No. 35/76, dated 25-2-1976. We find that on 1-7-1977, Notification No. 251/76, dated 14-9-1976 was the succeeding notification of Notification No. 210/73, dated 15-12-1973.

The basic issue that arises in this case is whether Notification No.251/76 could be automatically read in place of Notification No. 210/73 in Notification No. 35/76, dated 25-2-1976. We find that the proviso to Notification No. 35/76 was not amended. We also observe that this proviso specifically provided that if the factory of the appellants was covered by Notification No. 210/73 then the Notification No. 35/76 shall not be applicable. The proviso read as under : "Provided that nothing contained in the Notification of the Government of India in the Ministry of Finance (Department of Revenue and Insurance) No. 210/73-C.E., dated 15-12-1973 shall apply to a sugar factory covered by this notification." Since the proviso specifically mentions only Notification No. 210/73, dated 15-12-1973, the scope of the proviso has to be restricted to the said notification alone. Once it is superseded, the scope cannot be extended to a successor notification unless the successor notification makes a specific reference to Notification No. 35/76 or vice-versa. The admitted position is that the sugar factory of the appellants is covered by Notification No. 35/76.

9. We find that there are three show cause notices. The first show cause notice was issued on 25-10-1977 for denying the respondents herein the benefit of Notification No. 35/76 on the ground that they had contravened the proviso to the said Notification by availing the concession under Notification No. 210/73 which was superseded by Notification No. 223/76, dated 3-8-1976 and by other succeeding Notifications. Having regard to our finding in the previous paragraph that the scope of the proviso to Notification No. 35/76 is restricted to Notification No. 210/73 when it was in force the question of availment of Notification No. 210/73 does not arise after 3-8-1976.

10. The second show cause notice was issued on 12-3-1979. We find that the proviso to Notification No. 35/76 states that the provisions of Notification No. 210/73 shall not apply to a sugar factory covered by Notification No. 35/76. Though the subsequent notifications are in the nature of superseding notifications since the proviso to Notification No. 35/76 mentions only Notification No. 210/73 its scope cannot be extended to successor Notifications.

11. The second issue that arose for determination in this case was that the respondents herein contended that the demand was hit by limitation.

We find that in this case, the show cause notice was issued on 12-3-1979 for the demand pertaining to the period 1-10-1977 to 30-6-1978. Thus the demand was beyond a period of six months. The question is whether the invokation of a longer period is justified in the instant case or not. The department cited a decision of this Tribunal in the case of Malt Co. India (P) Ltd. reported in 1986 (26) E.L.T. 627 in which the Tribunal held that there is overwhelming authority supporting the contention that the assessment in RT 12 returns are appealable. As-against this, the Learned Counsel for the respondents submitted that later decisions of the Tribunal clearly indicate that a show cause notice is necessary whenever a demand for short levy or non-levy of duty is raised. We find force in the arguments of the Learned Counsel of the respondents. It is now a well settled proposition of law that every demand for short levy or non-levy can be raised only by issue of show cause notice. In the instant case, the admitted position is that the show cause notice was issued beyond a period of six months. There is no allegation of suppression, fraud or wilful mis-statement. We also observe that first show cause notice was issued on 25-10-1977. Therefore, the question of suppression or wilful mis-statement does not arise in this case. In this view of the matter, we hold that duty demanded under second show cause notice issued on 12-3-1979 is time barred.

12. The third show cause notice was issued on 28-3-1984. We find that the first contention of the respondents herein on the third show cause notice was that this show cause notice is a fresh show cause notice inasmuch as denial of exemption under Notification Nos. 223, 226, 251 all of 1976 and 317 of 1977 was introduced for the first time and was not in the first two show cause notices. The Ld. Counsel submitted that this show cause notice was not only an addendum but a fresh show cause notice; that this show cause notice was issued beyond a period of five years, therefore, it is hit by limitation. We agree with this contention of the Ld. Counsel for the respondents and hold that this show cause notice is also hit by limitation and the demand raised therein is time barred.

13. Since we find that the second and third show cause notices are hit by limitation, the charges and demands contained therein do not survive. The proceedings arising therefrom would consequently abate.

Ordered accordingly. Consequential benefits, if any accruing in favour of the respondents herein would be admissible to them in the light of our observations in paragraphs 8 and 9 in relation to the first SCN and in accordance with law.