- (1.) The period covered in this judgment for which show cause notice was issued is 1993-1994 to 27-9-1997. Show cause notice was issued on 3-2-1998. At the relevant time, as per the provision of Section 11A of the Central Excise Act, 1944, normal period of limitation was six months. However, extended period of limitation was utilized invoking the provision of the proviso to that Section. We are concerned only with the issue of limitation in the instant case. It is argued by the learned Counsel for the Appellant that there was no mis-declaration or mis-statement and therefore the extended period of limitation could not have been invoked.
(2.) It is not necessary to go into the facts of the present case for this purpose. We find that the issue as to what factors should be taken into consideration for arriving at the cost of production was clarified by the Department in its Circular dated 30-10-1996 and on that basis in the case of Commissioner of Central Excise, Ahmedabad v. Asarwa Mills, 2015 319 ELT 216, this Court took the view that the Assessees could not be faulted with for taking into consideration some of those paras prior to the issuance of the said clarificatory circular. Para 9 of the said judgment reads as under: "The clarification, as noted above, pertains to calculation of value of goods captively consumed under Rule 6(b)(ii). It is this Rule which is undoubtedly applicable in the present case. Thus, for the first time, only in October, 1996, it was clarified that the cost of material, labour cost and overheads including administrative cost, advertising expenses, depreciation, interest, etc., would be included in the cost of production. The period with which we are concerned is prior to October, 1996, i.e. April, 1994 to September, 1996. It, therefore, cannot be said that the Respondents-companies made intentional mis-declaration with the purpose to avoid payment of correct Excise duty. We thus, find that the CESTAT was right in holding that extended period of limitation would not be applicable in the present case."
(3.) Applying the aforesaid principle extended period of limitation up to September, 1996 cannot be invoked.;