Assessee being dealer and not manufacturer not liable to pay excise duty under section 11D - Apex Court
THE short legal question before the Tribunal was whether the assessee, being only a "dealer" and not a "manufacturer" was liable to pay excise duty under section 11D of the Act?
The Tribunal accepted assesse's plea that the amendment of sub-section (1) of section 11D of the Act, with retrospective effect from September 20, 1991, by section 103 of Finance Act, 2000, had no application to the period in question i.e. July 1997 to August 2000. The Tribunal held as follows:
"There is no dispute before us that demand sustained by the Commissioner was in respect of the goods which were not manufactured by the appellant. Before the Andhra Pradesh High Court the constitutional validity of Section 11-D, before its amendment was under challenge along with other provisions. In order to uphold the constitutionality of the provisions the High Court read down the expression `every person' in sub-section (1) of Section 11-D as the manufacturer/producer as also the expression `every person' appearing in Section 28-B of the Customs Act as the importer. It was the above view that has been expressed by this statutory amendment under Section 103 of the Finance Act 2002 with retrospective effect from 20.09.91.
In the present case, we are concerned with the demand for a period from July 1997 to August 2000. Under these circumstances, the appellant's contentions are only to be accepted. No demand can be raised against the appellant under Section 11-D as it is not the manufacturer of the concerned goods. In the result, we set aside the impugned order and allow the appeal."
Revenue took the matter to the Apex Court by filing an appeal under section 35L(b) of the Central Excise Act, 1944.
After hearing both sides, the Apex Court decided the issue in favour of assessee () by holding that in view of the period involved in the present appeal, viz. July 1997 to August 2000, there is no infirmity in the impugned order passed by the Tribunal on merits. It was further held that the present appeal was not maintainable under section 35L(b) of the Act as it does not involve determination of any question having relation to rate of duty of excise or to value of goods for the purpose of assessment.