COMMISSIONER, CENTRAL EXCISE AND CUSTOMS AND ANOTHER versus M/S RELIANCE INDUSTRIES LTD. on 4 July 2023

[2023] 9 S.C.R.

ATHE COMMISSIONER, CENTRAL EXCISE AND CUSTOMSAND ANOTHER

v.

M/S RELIANCE INDUSTRIES LTD.

B(Civil Appeal No. 6033 of 2009)

JULY 04, 2023

[KRISHNA MURARI AND BELA M. TRIVEDI, JJ.]

Central Excise Act, 1944: s. 11A – Demand for differentialduty of excise – Invocation of extended period of limitation –CAllegation that the assessee incorrectly determined the assessablevalue of its finished goods by not including the monetary value ofthe duty benefits that it had obtained from its customers as a resultof the transfer of the advance licenses – Demand of differentialduty during the material period by the Department invoking theDextended period of limitation available u/s. 11A(1) proviso – Demandraised beyond the normal limitation period of one year – Allegationthat the assessee suppressed the relevant facts and made wilfulmisstatements withholding material information and documents fromthe department – Demand for differential duty confirmed againstthe assessee – However, the tribunal set aside the same – On appeal,Eheld: In the absence of any specific column or note as under FormER-1, requiring separate disclosure of the value of deemed exportclearances, no merit in the findings of the adjudicating authoritythat there was suppression of facts as a consequence of assessee’sfailure to separately disclose the value of deemed export clearancesF– Moreover, the issue of valuation involved is one where twoplausible views could co-exist – In such cases, it would be totallyunjustified to invoke the extended period of limitation by consideringthe assessee’s view to be lacking bonafides – Whereas, assessee’sconduct during the material period cannot be considered to bemalafide when it merely followed the view taken by the tribunal inGIFGL’s case which was later overturned by this Court – As regards,disclosure of facts, the assessee had disclosed to the department itspricing policy by giving separate letters – Assessee can be accusedfor suppressing only such facts which it was otherwise required tobe disclosed under the law – However, the revenue unable to showHthe provision or rule which required the assessee to make additional disclosures of documents or facts – Thus, the assertion that therewas suppression of facts not tenable – Furthermore, the demandsraised are time barred.

Dismissing the appeals, the Court

HELD: 1.1 The format of the ER-1/RT-12 return which theassessee was required to file on a monthly basis for intimating tothe department the value of clearances effected and the amountsof duties paid thereon. There is no separate column orrequirement in these forms for declaring the value and otherdetails of clearances effected to the deemed export buyers i.e.holders of advance licenses. Note 4 under Form ER–1 doesrequire separate details to be mentioned for exports under bond.Indisputedly clearance made to domestic buyers even if they areconsidered deemed exports are not clearances for “exports underbond” for which category of clearances alone requirement existedfor separate disclosure in the ER-1/RT-12 returns. In the absenceof any specific column or note similar to note 4, requiring separatedisclosure of the value of deemed export clearances, there is nomerit in the findings of the adjudicating authority that there wassuppression of facts as a consequence of assessee’s failure toseparately disclose the value of deemed export clearances. Anaccusation of non–disclosure can only be made if there is in thefirst instance a requirement to disclose. [Para 20][1297-B-D]

1.2 Note 4 to Form ER-1 requires separate details ofclearances to be mentioned for exports under Bond. There is noreference in the said notes to deemed exports or supplies madeto holders of advance licenses. The submissions that the assesseewas never required to separately furnish details of clearancesmade to holders of advance licenses is accepted. Neither theshow cause notice nor the civil appeal filed by the Revenue beforethis Court contain any reference to the wrongful clubbing ofdeemed export clearances under the details meant for domesticclearances. Also the order of the tribunal does not contain anyreference to this particular aspect which was the main thrust ofthe oral arguments made by the Counsel for the Revenue beforethis Court. The Revenue cannot be permitted to argue its mattersby going beyond the written pleadings filed by it before this Court.

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AThe mere fact that the oral arguments are supported by findingsof the adjudicating authority, which is not the order impugnedbefore this Court, does not entitle the Revenue to resurrect apoint which though made at the original stage, was never pressedbefore the tribunal or even incorporated in the memo of appealfiled before this Court. [Para 21][1297-E-H; 1298-A]

B

1.3 The submission of the Revenue that the tribunal’s orderin the case of IFGL Refractories could not have constituted avalid basis for the belief entertained by the assessee in view ofthe fact that the relevant valuation provisions had undergoneamendments in the year 2000 cannot be accepted. Firstly, thisCcontention too has not been urged in the Civil Appeal filed by theRevenue and has been urged only during the course of the hearingbefore this Court; and secondly, the submission is diametricallyopposite to what the Revenue itself has been contending on meritsright from the Show cause notice till the appeal filed before thisDCourt. On merits, the Revenue’s case throughout had been thatthe issue of valuation is covered against the assessee by thejudgement of this Court in the case of IL Refractories. Even inthe order of the CESTAT under challenge the tribunal proceededon the basis that the principle of valuation laid down by this Courtin the case of IFGL Refractories holds good and remains validEeven under the amended valuation provisions for the period postJuly 2000. It is strange that for the purposes of justifying its caseon limitation, the Revenue wishes to take a position exactlycontrary to what it has taken in the Show Cause Notice on merits.The Revenue cannot be allowed to blow hot and cold in the same Fbreath by relying upon IL’s case on merits while at the sametime arguing that the same had no relevance for the purposes ofexamining the plea for a bonafide belief. [Para 22][1298-B-F]

1.4 The finding of the tribunal that during the period indispute it was holding a bonafide belief that it was correctlyGdischarging its duty liability is concurred with. The mere fact thatthe belief was ultimately found to be wrong by the judgment ofthis Court does not render such belief of the assessee a malafidebelief particularly when such a belief was emanating from the viewtaken by a division bench of tribunal. The issue of valuation H

THE COMMISSIONER, CENTRAL EXCISE AND CUSTOMS v.M/S RELIANCE INDUSTRIES LTD.

involved in this particular matter is indeed one where two plausibleviews could co-exist. In such cases of disputes of interpretationof legal provisions, it would be totally unjustified to invoke theextended period of limitation by considering the assessee’s viewto be lacking bonafides. In any scheme of self–assessment itbecomes the responsibility of the assessee to determine hisliability of duty correctly. This determination is required to bemade on the basis of his own judgment and in a bonafide manner.[Para 23][1298-G-H; 1299-A-B]

1.5. The extent of disclosure that an assessee makes isalso linked to his belief as to the requirements of law. In theinstant case, the assessee who was required to self–assess hisliability determined the assessable value on the basis of aninterpretation given by CESTAT. It could not have foreseen thatthe view taken by CESTAT would be upset and overturned bythe Supreme Court as it happened on 9.8.2005. The assessee’sconduct during the material period, between 2000 to 2005 cannotbe considered to be malafide when it merely followed the viewtaken by the tribunal in IFGL’s case. On the question of disclosureof facts, the assessee had disclosed to the department its pricingpolicy by giving separate letters. It is also not disputed that thereturns which were required to be filed were indeed filed. In thesereturns, there was no separate column for disclosing details ofthe deemed export clearances. Separate disclosures wererequired to be made only for exports under bond and not fordeemed exports, which are a class of domestic clearances, entitledto certain benefits available otherwise on exports. There wasthus, nothing wrong with the assessee’s action of including thevalue of deemed exports within the value of domestic clearances.[Para 24][1299-B-E]

1.6. In the show cause notice itself it has been accepted bythe revenue that the self–assesment procedure did not requirean assessee to submit copies of all contracts, agreements andinvoices. This being the admitted position in the notice there isno basis for agreeing with the findings of the Commissioner thatcertain relevant documents had not been filed and therebysuppressed from the scrutiny of the revenue officers. An assesseecan be accused for suppressing only such facts which it was ABC

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Aotherwise required to be disclosed under the law. The counselfor the Revenue has, while pleading that facts was suppressedbeen unable to show the provision or rule which required theassessee in this case to make additional disclosures of documentsor facts. The assertion that there was suppression of facts istherefore clearly not tenable. [Para 25][1299-F-H]B

1.7. The Show Cause Notice in CA No. 5744/2011 pertainsto a different plant of the assessee and sought to invoke theextended period of limitation by making similar allegations as inCA No. 6033 of 2009. The conclusions with regard to CA No.6033 of 2009 apply equally to this appeal. The demands are timeCbarred. [Para 26][1300-A-C]

Pushpam Pharmaceuticals Company Vs. Collector ofCentral Excise, Bombay (1995) Supp 3 SCC 462;Collector of Central Excise, Hyderabad Vs. M/s.Chemphar Drugs and Liniments, Hyderabad (1989) 2DSCC 127 : [1989] 1 SCR 711; IFGL Refractories Ltd.[2001 (134) ELT 230] – referred to.

Case Law Reference

From the Judgment and Order dated 17.03.2009 of the Customs,Excise & Service Tax, Appellate Tribunal West Zonal Bench atFAhmedabad in Appeal No.E/228, 240 and 241 of 2007.

With

Civil Appeal No.5714 of 2011.

Ms. Nisha Bagchi, Mukesh Kumar Maroria, S. S. Rebello, PrahladGSingh, Advs. for the Appellants.

Shyam Divan, Sr. Adv., K. R. Sasiprabhu, Jaydeep Patel, VipinJain, Ms. Shilpa Balani, Udayaditya Banerjee, Vishnu Sharma A. S.,Prakhar Agarwal, Advs. for the Respondent.

The Judgment of the Court was delivered by KRISHNA MURARI, J.

1. The present appeals are directed against the impugned orderdated 17.03.2009 passed by the Customs, Excise & Service Tax AppellateTribunal (CESTAT), Ahmedabad, in C.O No. M/419-21/WZB/AHD/08whereby, the learned Tribunal allowed the appeal therein. Since the centralissues involved in Civil Appeal Nos. 6033/2009 and 5714/2011 are thesame, they are being adjudicated upon by this common order.

FACTS

2. For the sake of convenience, we are first taking up the facts ofCivil Appeal No. 6033/2009. The order impugned in this appeal is that ofCustoms, Excise & Service Tax Appellate Tribunal (CESTAT or Tribunal)dated 17.3.2009 which had, by a majority of 2:1, allowed an appeal filedby the Respondent-Assessee against an order of the Commissioner ofCentral Excise, Rajkot by which a demand for differential duty wasconfirmed against the assessee by invoking the extended period oflimitation available under the proviso to Section 11A (1) of the CentralExcise Act, 1944.

3. The demand for differential duty of excise was raised on theallegation that the assessee had incorrectly determined the assessablevalue of its finished goods by not including therein the monetary value ofthe duty benefits that it had obtained from its customers as a result ofthe transfer of the advance licenses.

4. This demand for differential duty was raised for clearancesmade during the period of September 2000 to March 2004. The ShowCause Notice which was issued on 28.9.2005 relied upon a judgment ofthis Court on 9.8.2005 in the case of IFGL Refractories Ltd in support ofthe plea that monetary value of duty benefits obtained through transferof advance licenses held by the customers constituted additionalconsideration flowing to the assessee from such customers.

5. Since the demand for differential duty was being raised on28.9.2005, which was beyond the normal limitation period of one yearprescribed in Section 11A(1) of the Act, the show cause notice alsoalleged that the noticee had deliberately suppressed relevant facts andhad made willful misstatements withholding material information anddocuments from the departmental officers.

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B

CD

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A6. The allegations in the notice were confirmed by theCommissioner in his order dated 30.10.2006 wherein the assessee’sdefense on merits as well as on limitation were rejected.

7. The Commissioners’ order was challenged by the assesseebefore CESTAT, which allowed that appeal by a majority order byBaccepting the assessee’s plea that the dispute was revenue neutral havingno Revenue implications since the customers of the assessee were eligibleto avail cenvat credit of duties actually paid or any differential dutypayable on the goods cleared by the assessee. We are not dwellingdeeper on the other findings of the Tribunal on the merits of the mattersince these appeals are being decided only on the issue of time bar.C

8. On the issue of time bar, the CESTAT has held that during therelevant period the Appellant could have entertained a bonafide beliefthat it had correctly discharged its duty liability in view of the view takenby the Tribunal in the case of IFGL Refractories Ltd.[1]which came tobe reversed by this Court only on 9.8.2005. It is relevant to note hereDthat insofar as the decision on time bar is concerned the view of the twolearned members who constituted the division bench of CESTAT wasunanimous.

9. The difference of opinion, therefore, arose only on the meritsof the matter which also came to be decided in favour of the assesseeEby a 2-1 majority. Since arguments before us are confined to the issue oflimitation, it is necessary to take note of the findings of the CESTAT onthe same. The finding of the Member (Technical) on the issue of limitationwas as under:

“As regards the submission on time bar, it is noticed that theFCommissioner has relied on the Hon’ble Supreme Court’sjudgement dt. 9.8.2005 in the case of M/s. IFGL RefractoriesLtd. cited supra. This decision of the Hon’ble Supreme Courthas reversed the decision of the Tribunal in the case of M/sIFGL Refractories Ltd. [2001 (134) ELT 230]. In other words,Gthe Tribunal has taken a view that discounts offered toadvance licence holders were not additional considerationwhich decision has been reversed by the Hon’ble SupremeCourt. Under these circumstances, the claim that the appellantwas having a bonafide belief that the additional discounts 1 [2001 (134) ELT 230]H

are permissible has to be accepted and demand of duty hasto be confined to duty within the normal period of limitation.No penalty will be justified.”

10. The corresponding finding of the Member (Judicial) on theissue of limitation were as under:

“The orders proposed by learned Member (Technical) allowedAppeal No. E/228/07, on point of limitation, by setting asidethe confirmation of demand and penalty imposed upon theappellant. I agree with the said order passed by learnedMember (Technical) in the said appeal.”

ANALYSIS

11. We have heard the contentions of both the parties in greatdetail.

12. Section 11A of the Central Excise Act, 1944, which deals withthe issue of limitation for issuing show cause notices for recovery ofduties which have been short paid or short levied, is the governing law inthe present case. Sub-section (1) of Section 11(A), which is most relevantto the present case, for the sake of convenience, is being reproducedhereunder:

“(1) When any duty of excise has not been levied or paid orhas been short-levied or short-paid or erroneously refunded,whether or not such non-levy or non-payment, short-levy orshort payment or erroneous refund, as the case may be, wason the basis of any approval, acceptance or assessmentrelating to the rate of duty on or valuation of excisable goodsunder any other provisions of this Act or the rules madethereunder, a Central Excise Officer may, within one yearfrom the relevant date, serve notice on the person chargeablewith the duty which has not been levied or paid or which hasbeen short-levied or short paid or to whom the refund haserroneously been made, requiring him to show cause why heshould not pay the amount specified in the notice: “

13. The first proviso to the abovementioned sub-section (1), whichis the relevant provision relating to the extended period of limitation,reads as under:

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A“Provided that where any duty of excise has not been leviedor paid or has been short levied or short-paid or erroneouslyrefunded by reason of fraud, collusion or any wilfullmisstatement or suppression of facts, or contravention of anyof the provisions of this Act or of the rules made thereunderwith intent to evade payment of duty, by such person or hisBagent, the provisions of this sub-section shall have effect, forthe words one year the words five years were substituted.”

14. In the case of Pushpam Pharmaceuticals Company Vs.Collector of Central Excise, Bombay[2], this Court, while dealing with asimilar fact circumstance wherein the extended period of limitation underCthe abovementioned proviso had been invoked, held that since theexpression “suppression of facts” is used in the company of terms suchas fraud, collusion and willful misstatement, it cannot therefore refer toan act of mere omission, and must be interpreted as referring to adeliberate act of non-disclosure aimed at evading duty, that is to say, anDelement of intentional action must be present.

15. Similarly, in the case of Collector of Central Excise,3Hyderabad Vs. M/s. Chemphar Drugs and Liniments, Hyderabad,this Court, while dealing with a similar situation of invocation of extendedperiod of limitation under Section 11(A) of the Act, this Court held asEunder:

“In order to make the demand for duty sustainable beyond aperiod of six months and up to a period of 5 years in view ofthe proviso to sub-section 11A of the Act, it has to beestablished that the duty of excise has not been levied or paidFor short-levied or short-paid, or erroneously refunded byreasons of either fraud or collusion or willful misstatementor suppression of facts or contravention of any provision ofthe Act or Rules made thereunder, with intent to evade paymentof duty. Something positive other than mere inaction or failureon the part of the manufacturer or producer or conscious orGdeliberate withholding of information when the manufacturerknew otherwise, is required before it is saddled with anyliability, before the period of six months. Whether in aparticular set of facts and circumstances there was any fraud 2 1995 Sup (3) SCC 462H3 1989 (2) SCC 127

THE COMMISSIONER, CENTRAL EXCISE AND CUSTOMS v.M/S RELIANCE INDUSTRIES LTD. [KRISHNA MURARI, J.]

or collusion or willful misstatement or suppression orcontravention of any provision of any Act, is a question offact depending upon the facts and circumstances of aparticular case. The Tribunal came to the conclusion that thefacts referred to hereinbefore do not warrant any inferenceof fraud. The assesse declared the goods on the basis of theirbelief of the interpretation of the provisions of the law thatthe exempted goods were not required to be included and thesedid not include the value of the exempted goods which theymanufactured at the relevant time. The Tribunal found thatthe explanation was plausible, and also noted that theDepartment had full knowledge of the facts aboutmanufacture of all the goods manufactured by the respondentwhen the declaration was filed by the respondent. Therespondent did not include the value of the products otherthan those falling under Tariff Item 14E manufactured by therespondent and this was in the knowledge, according to theTribunal, of the authorities. These findings of the Tribunalhave not been challenged before us or before the Tribunalitself as being based on no evidence”

16. The main submission of the Learned Counsel appearing onbehalf of the assesse was that during the period under reference i.e.September 2000 to March 2004, the practice of valuation followed bythe assessee was strictly in accordance with the view taken by CESTATin IFGL’s case. The CESTAT in that case held that duty benefits receivedby an assessee under the duty exemption scheme announced by theGovernment cannot be considered as part of the consideration flowingfrom the buyer, either directly or indirectly. The Tribunal order refers toseveral other orders and judgements for coming to the conclusion thatsubsidies, incentives and duty drawbacks received by an assessee fromthe Central Government or the State Government cannot be regardedas part of the consideration flowing from the buyer to the seller.

17. After referring to the detailed observations and finding of theCESTAT, in IFGL’s case, particularly those in para 9 and 10 thereof, theLd. Counsel for the assessee submitted that, though the above view ofthe Tribunal was reversed by this Court on 9.8.2005 while deciding CivilAppeal No.4472 of 2001, it cannot be denied that during the period from28.7.2000 (the date when the Tribunal decided the IGL’s case) till 9.8.2005

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A(when the Supreme Court reversed it) the view taken by the Tribunal inIFGL’s case held the field and thus provided the basis for the assesse tobelieve that its method and approach of determining the assessable valuewas in accordance with law. The Ld. Counsel further pointed out thatthere was otherwise no justification for alleging suppression of facts inthe present case as the assessee had submitted to the Revenue authoritiesBcopies of their pricing policy from time to time. Our attention was invitedto para 2 of the Show Cause Notice dated 28.9.2005 wherein this facthas been recorded in the notice.

18. The Ld. Counsel for the revenue on the other hand submittedthat the Tribunal had failed to apply its mind to the allegations and specificCfinding of the adjudicating authority. It was submitted that the adjudicatingauthority had specifically found that the subject transactions whereadditional discounts had been offered to certain customers who hadagreed to transfer to the assessee duty benefits flowing from advancelicence held by them were wrongly clubbed with domestic clearancesDwith a view to mislead range officer tasked with the responsibility ofchecking the transactions. The Ld. Counsel for the Revenue accordinglysubmitted that the assesse was guilty of suppressing material facts fromthe Revenue authorities and that the Range officer had thus been misledinto believing that the duty had been correctly paid. The Ld. Counselalso invited our attention to the fact that during the relevant period theEassessee was working under self-assessment procedure were the onusto correctly assess duty vested upon the assesse. The Ld. Counsel forthe Revenue also submitted that the finding of the CESTAT about bonafidebelief based on the CESTAT’s decision on the IGL’s case was alsounsustainable in view of the specific findings of the adjudicating authority Fof suppression of material facts by clubbing of the clearances withdomestic clearances which mislead the range officer tasked with theresponsibility of checking all transactions.

19. Per contra the Ld. Counsel for the assesse submitted that thearguments made on behalf of the Revenue traverse beyond the groundsGtaken in the appeal and also the allegations in the show cause notice. Itwas his further submission that there was no wrongful clubbing of deemedexport clearances with domestic clearances. It was pointed out that themonthly returns (ER-1/RT-12) that the assessee was required to filedoes not have any separate column for declaring deemed exportclearances. Since the subject clearances on which differential duty hasH

THE COMMISSIONER, CENTRAL EXCISE AND CUSTOMS v.M/S RELIANCE INDUSTRIES LTD. [KRISHNA MURARI, J.]

been demanded has been initially been made upon payment of duty,such clearances had correctly been shown as duty paid domesticclearances.

20. We have seen the format of the ER-1/RT-12 return which theassessee was required to file on a monthly basis for intimating to thedepartment the value of clearances effected and the amounts of dutiespaid thereon. We do not find any separate column or requirement inthese forms for declaring the value and other details of clearanceseffected to the deemed export buyers i.e. holders of advance licenses.Note 4 under Form ER-1 does require separate details to be mentionedfor exports under bond. Indisputedly clearance made to domestic buyerseven if they are considered deemed exports are not clearances for“exports under bond” for which category of clearances alone requirementexisted for separate disclosure in the ER-1/RT-12 returns. In the absenceof any specific column or note similar to note 4, requiring separatedisclosure of the value of deemed export clearances, we do find anymerit in the findings of the adjudicating authority that there wassuppression of facts as a consequence of assessee’s failure to separatelydisclose the value of deemed export clearances. An accusation of non-disclosure can only be made if there is in the first instance a requirementto disclose.

21. We also find that Note 4 to Form ER-1 requires separatedetails of clearances to be mentioned for exports under Bond. There isno reference in the said notes to deemed exports or supplies made toholders of advance licenses. We therefore agree with the submissionsof the counsel for the assessee that the assesse was never required toseparately furnish details of clearances made to holders of advancelicenses. We also find that neither the show cause notice nor the civilappeal filed by the Revenue before this Court contain any reference tothe wrongful clubbing of deemed export clearances under the detailsmeant for domestic clearances. Also the order of the Tribunal does notcontain any reference to this particular aspect which was the main thrustof the oral arguments made by the Ld. Counsel for the Revenue beforethis Court. In our considered view, the Revenue cannot be permitted toargue its matters by going beyond the written pleadings filed by it beforethis Court. The mere fact that the oral arguments are supported by findingsof the adjudicating authority, which is not the order impugned before thisCourt, does not entitle the Revenue to resurrect a point which though AB

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Amade at the original stage, was never pressed before the Tribunal oreven incorporated in the memo of appeal filed before this Court.

22. We also find no merits in the other argument urged by the Ld.Counsel for the Revenue that the Tribunal’s order in the case of IFGLRefractories could not have constituted a valid basis for the beliefBentertained by the assesse in view of the fact that the relevant valuationprovisions had undergone amendments in the year 2000. The argumentof the Revenue’s Counsel was that in view of the amendments to Section4 and Rule 6 of the Valuation Rules the ratio of the Tribunal’s decision inIFGL’s case was no longer relevant for the period under considerationin these appeals. We have no hesitation in rejecting this contention forCtwo independent reasons. Firstly, this contention too has not been urgedin the Civil Appeal filed by the Revenue and has been urged only duringthe course of the hearing before this Court. On this count alone thecontention deserves to be ignored. Secondly, we also find this contentionto be diametrically opposite to what the Revenue itself has beenDcontending on merits right from the Show cause notice till the appealfiled before this Court. On merits, the Revenue’s case throughout hadbeen that the issue of valuation is covered against the assessee by thejudgement of this Court in the case of IL Refractories. Even in the orderof the CESTAT under challenge the Tribunal has proceeded on the basisthat the principle of valuation laid down by this Court in the case of IFGLERefractories holds good and remains valid even under the amendedvaluation provisions for the period post July 2000. We therefore find itstrange that for the purposes of justifying its case on limitation, theRevenue wishes to take a position exactly contrary to what it has takenin the Show Cause Notice on merits. We cannot allow the Revenue toFblow hot and cold in the same breath by relying upon IL’s case on meritswhile at the same time arguing that the same had no relevance for thepurposes of examining the plea for a bonafide belief.

23. We are in full agreement with the finding of the Tribunal thatduring the period in dispute it was holding a bonafide belief that it wasGcorrectly discharging its duty liability. The mere fact that the belief wasultimately found to be wrong by the judgment of this Court does notrender such belief of the assessee a malafide belief particularly whensuch a belief was emanating from the view taken by a division bench ofTribunal. We note that the issue of valuation involved in this particularmatter is indeed one were two plausible views could co-exist. In suchH

cases of cases of disputes of interpretation of legal provisions, it wouldbe totally unjustified to invoke the extended period of limitation byconsidering the assessee’s view to be lacking bonafides. In any schemeof self-assessment it becomes the responsibility of the assessee todetermine his liability of duty correctly. This determination is required tobe made on the basis of his own judgment and in a bonafide manner.

24. The extent of disclosure that an assessee makes is also linkedto his belief as to the requirements of law. In the present case the assesseewho was required to self-assess his liability determined the assessablevalue on the basis of an interpretation given by CESTAT in its orderdated 28.7.2000. It could not have foreseen that the view taken byCESTAT would be upset and overturned by the Supreme Court as ithappened on 9.8.2005. The assessee’s conduct during the material periodi.e. between 2000 to 2005 cannot be considered to be malafide when itmerely followed the view taken by the Tribunal in IFGL’s case. On thequestion of disclosure of facts, as we have already noticed above theassessee had disclosed to the department its pricing policy by givingseparate letters. It is also not disputed that the returns which were requiredto be filed were indeed filed. In these returns, as we noticed earlierthere was no separate column for disclosing details of the deemed exportclearances. Separate disclosures were required to be made only forexports under bond and not for deemed exports, which are a class ofdomestic clearances, entitled to certain benefits available otherwise onexports. There was therefore nothing wrong with the assessee’s actionof including the value of deemed exports within the value of domesticclearances.

25. We also take note of the fact that in the show cause noticeitself it has been accepted by the revenue that the self-assesmentprocedure did not require an assessee to submit copies of all contracts,agreements and invoices. This being the admitted position in the noticewe do not find any basis for agreeing with the findings of theCommissioner that certain relevant documents had not been filed andthereby suppressed from the scrutiny of the revenue officers. An assesseecan be accused for suppressing only such facts which it was otherwiserequired to be disclosed under the law. The counsel for the Revenuehas, while pleading that facts was suppressed been unable to show usthe provision or rule which required the assessee in this case to makeadditional disclosures of documents or facts. The assertion that therewas suppression of facts is therefore clearly not tenable.

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A26. Insofar as the appeal No. 5744/2011 is concerned, we findthat the same pertains to a different plant of the Assessee-Respondentwhere clearances were affected during the period January 2001 toNovember 2003. The Show Cause Notice in this case was issued on29.12.2005 and sought to invoke the extended period of limitation bymaking similar allegations as in Civil Appeal No. 6033 of 2009. TheBorder impugned in this appeal, however is an order dated 4.4.2010 of theGujarat High Court by which the Court had dismissed an appeal filed bythe revenue against an order of CESTAT, by holding that no question oflaw could be stated to arise from the order of CESTAT. Our conclusionswith regard to Civil Appeal 6033 of 2009 apply equally to this appeal. InCthe result both the appeals filed by the Revenue are dismissed on theground that the demands are time barred. We make it clear that weexpress no opinion on the merits of the matter including the aspects ofrevenue neutrality.

D

Nidhi Jain

(Assisted by : Tamana, LCRA)

Appeals dismissed.

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