1. These are four appeals of identical nature under Section 35B of Central Excises and Salt Act, 1944, coming up for hearing and decision simultaneously. Therefore, they are being considered and decided through a common order. The appellant's representative Shri Bhave has briefly discussed the facts of each appeal. The basic issue is the demand for duty issued by the Assistant Collector of Central Excise on losses over 0.75% of Mineral oil transferred in bond under Rule 152 from the appellants' installations in Bombay to their installations in Delhi. The Central Excise Authorities in charge of their installations at Bombay have thus recovered duty on losses in excess of 0.75% in the quantities transferred under each A.R. 3 application to Delhi in bond.
Though the details of each appeal are not the same, the basic issue is the same in all the appeals. The learned representative of the appellants has stated that the demands for duty were made under Rule 160 of the Central Excise Rules, 1944. These demands have been paid under protest and in two cases the claims for refunds were rejected, and hence, all these matters had come up before the Tribunal as a final resort. Shri Bhave stated that the Assistant Collector's reliance on Rule 160 for demanding the duty on the excess losses was not correct.
The relevant rules would be 156A and 156B. However, for the sake of argument even if it were conceded that the demands lie under Rule 160, the same was not made within the time limit prescribed under Rule 10 in all the cases and the demands were time-barred partly. Shri Bhave referred to Rule 10 as it existed in 1980, and stated that this Tribunal had held that the demand under Rule 160 had to be made within the time limit of Rule 10. He referred us to our decision in the case of Hindustan Petroleum Corporation Ltd. v. Collector of Central Excise, Bombay-H, 1983 (1) E.T.R. 353. He further argued that in case it was held that proper rules would be Rules 156A and 156B as submitted by him, even then the demand was time-barred. Elucidating his point he read out Rule 10 as in force at the relevant time. He argued that in case of transfer of oil in bond there was no assessment, and the relevant date for the purpose of Rule 10 would be the 90th day under Rule 156A(4) by which date the consignor was required to present the triplicate AR. 3 application duly endorsed with the certificate of warehousing at destination to the Central Excise Officer in charge of the warehouse of origin. Even if the time limit were to be computed on this basis for the appeals in question, most of the demands would be barred by limitation. Shri Bhave read Rule 10 as it stood prior to the amendment on 6-8-1977, and referring to the headings of the old Rule and the new Rule he tried to explain the intention behind the rule, in the original and amended forms, Shri Bhave further argued that Rule 10 after the amendment in August, 1977 would cover all cases of payment or non-payment of duty and refund of duty erroneously paid. He explained that Rule 10 was wide enough and it was for this reason that Rule 10A was simultaneously dropped with the incorporation of new Rule 10 with effect from 6-8-1977. In this behalf he referred to the Supreme Court's Judgement in the case of Assistant Collector of Central Excise v.Elphinstone Spinning and Weaving Mills Co. Ltd., A.I.R. 1971 S.C. 2039.
Applying Rule 10 to the present cases, Shri Bhave argued that for the purpose of determining the relevant date under proviso to Rule 10, Rule 156A(4) and 156B were relevant. These rules laid down the limitation period. Shri Bhave further clarified that no request for extension of the period for submission of A.R. 3 application with the certificate of warehousing from the place of destination, was made to the Central Excise Authorities at Bombay, and hence there was no question for recomputation of the time limit. All the demands made in the four appeals were beyond the period of 6 months and hence they were time-barred, except for certain demands covered by the first and the last appeals. Shri Bhave submitted that in case the Tribunal so desired, these two appeals may be referred to the lower authorities for readjudication of the demands for taking into consideration the limitation aspect as urged by him. As regards the Collector of Central Excise (Appeals) reliance on the Judgement of the Calcutta High Court in the case of Mahindranath v. Collector of Central Excise (1977) E.C.R. 1754-1757, Shri Bhave submitted that the ratio of this judgement was not applicable to the appeals under consideration as the case before the Calcutta High Court covered surreptitious removal of tobacco from the warehouse which fell within the ambit of Rule 160 while in the present case, Rule 160 was not applicable as submitted by him. Besides, Rule 160 was specific to the facts of the case before the Hon'ble High Court in Calcutta and in that case the general Rule 10 was not favoured in preference to the specific Rule 160. In view of the foregoing submissions, he requested that all the four appeals be allowed.
2. The learned departmental representative argued that Rule 10 would not apply and that Rule 160 will apply, and since Rule 160 did not have any time limit for the purpose of raising demand, the demands were not hit by time-bar and therefore, the orders of the Assistant Collector and Collector of Central Excise (Appeals) were legal. On the aforesaid grounds he submitted that the same should be confirmed.
3. Shri Bhave stated in reply that the departmental representative had not answered any of the points raised by him, particularly the decision by this Tribunal in the appellant's own case vide 1983 (12) E.L.T. 631.
Shri Bhave therefore, reiterated his submissions.
4. We have examined the submissions on both the sides. The first point for consideration is to determine the correct rule applicable to the facts of the cases under appeal. The appellants have urged that Rule 160 of the Central Excise Rules, 1944 under which the demands have been issued and duties realised is not applicable. They argue that Rule 160 applies in cases of improper removal from a warehouse or where goods are allowed to remain beyond the fixed period or when they are lost or destroyed. In the present case the goods have not been improperly removed, but have been removed on A.R. 3 application after due permission from the Central Excise Authorities. It is also seen that they are not unaccounted for the purpose of Rule 160. From this point of view it is seen that the entire quantities have been removed from the warehouses of origin as per A.R. 3 applications. Therefore, the goods have been accounted so far as the warehouses of origin are concerned but that received at destination. These shortages have occurred between the dates the goods left the warehouses in Bombay and the dates they reached Delhi and were rewarehoused there. Therefore, we find ourselves in agreement with the submissions of the appellants that the shortages cannot be treated as non-account-al of goods for the purpose of Rule 160. The goods were permitted to be removed from one warehouse to another under Rule 152, and bond was required to be given for due arrival and rewarehousing at destination under Rule 153.
Sub-rule (3) of Rule 153 inter alia stipulates that the bond shall not be discharged until the full duty on any deficiency in such goods is paid. Thus, these demands have been made and duties recovered in terms of Rule 153 and not Rule 160 as held by the lower authorities or in terms of Rules 156A and 156B which are only the procedural rules consequent to the permission for removal of goods from one warehouse to another under Rule 152. Therefore, we cannot accept the appellants' contention that the demands and recoveries are governed under Rules 156A and 156B. In this view the submissions of the appellants that the relevant date for the purposes of Rule 10 should be reckoned from the expiry of 3 months' period under Rule 156A(4) becomes irrelevant. In coming to the conclusion that the demands lie under Rule 153 (3) of the Central Excise Rules, 1944, though they have been raised under Rule 160 of the Central Excise Rules, we are fortified in our decision with the Supreme Court's Judgement in the case of Assistant Collector of Central Excise v. Elphinstone Spinning and Weaving Mills Ltd. The Hon.. Supreme Court has held in this case that mere reference to a particular rule will not make the notice of demand invalid if the demand can be sustained under the provisions of some other rule. Therefore, the department's reliance on Rule 160 would not vitiate the demand as the duty is leviable under Rule 153 as held above. Therefore, the appellant's reliance on our decision at 1983 (12) E.L.T. 631 that time limit under Rule 10 will apply to demand under Rule 160 become misplaced for the purposes of the present appeals. The next question to determine is whether the time limit under Rule 10 would apply to the payment of duty under Rule 153 (3) of the Central Excise Rules, 1944.
We observe in this connection that though a period of 90 days has been laid down in Rule 156-A (4) for the certificate of rewarehousing to be submitted to the Central Excise Authorities in charge of the warehouse of origin, extension of the time limit can always be allowed, as this is a discretionary power with the proper officer of Central Excise under Rule 153 (1). Therefore, it is not correct to argue that limitation will start running from the 90th clay as mentioned under Rule 156-A (4) of the Central Excise Rules, 1944, as this will be a variable period and change with each extension. Furthermore, under sub-rule (3) of Rule 10, the 'relevant date' has been defined under clause (ii). The appellants seem to rely on proviso (a) of the definition of 'relevant date'. This runs as follows : "in the case of excisable goods on which duty has not been levied or paid or on which duty has been short levied or has not been paid in full, the date on which the duty was required to be paid under these rules," This implies that the excise duty has to be levied and paid or which was short levied or not paid though required to be levied and paid under the rules. In other words, the levy and payment of duty should have accrued as per the rules and it is only in this context that the relevant date has a meaning. In the present case, the goods have been removed under Rule 152 in bond and the need to pay duty has not arisen as required under Rule 9 when the goods were so removed. It is pertinent to observe that under the second proviso to Rule 9, the requirement to pay duty is postponed in case of removal of goods in bond. Since the requirement to pay duty has not arisen in these cases, it is wrong to seek recourse to Rule 10 read with Rules 156-A and 156-B of the Central Excise Rules, 1944 and argue that the demands are time-barred under Rule 10. We are therefore, not able to see any force in the pleas put forth by the appellants. It is seen that the bond executed under Rule 153 has to continue and cannot be discharged unless the goods are accounted for and the full duty on any deficiency in goods not accounted for is paid. The provisions of sub-rule (3) of Rule 153 are mandatory for the levy of duty. In this view the time limit under Rule 10 as then in existence cannot apply to the cases under appeal. For these reasons, we find that the arguments of the appellants are not tenable. The demands for duty have been correctly made. In this point of view the orders of the lower authorities are proper and we have no reasons to interfere with the same. Accordingly, we dismiss all the four appeals.