1. Recovery of duty for clearances — Issuance of show cause notice — Dispute regarding whether the notice is barred by limitation. (Para 1 )
Back
Next 
1997 Supreme(SC) 294
SUPREME COURT OF INDIA
S.C.Sen : Sujata V.Manohar
Collector Of Central Excise, Hyderabad
Versus
Pharmasia Private Limited
Case No. : 4225 of 1988
Date of Decision : 2/19/97
The statutory limitation of six months for issuing a show cause notice for recovery of duty applies unless fraud or misrepresentation is proven; mere correspondence regarding price lists does not constitute misrepresentation.
Headnote:(A) Central Excise Law - Limitation for issuing show cause notice - Recovery of duty - Notice issued beyond six months - Absence of fraud or misrepresentation - Correspondence regarding price lists does not constitute misrepresentation - Statutory limitation of six months applicable. (Para 2)
Facts of the case:
A show cause notice was issued to recover duty in respect of clearances effected prior to 16/12/1982. The notice was issued on 14/9/1983, which was beyond the statutory period of six months.
Findings of Court:
The tribunal correctly held that the show cause notice could not be issued beyond six months as there were no allegations of fraud or misrepresentation.
Issues: Whether the show cause notice issued to recover duty for clearances effected prior to a specific date was barred by limitation.
Ratio Decidendi: In the absence of fraud or misrepresentation, the statutory limitation of six months for issuing a show cause notice for recovery of duty is applicable; mere correspondence between parties regarding price lists does not amount to misrepresentation.
Result: Appeal dismissed.
Legal Category Hierarchy
Table of Contents
2. Whether the show cause notice is barred by limitation and whether correspondence regarding price lists constitutes misrepresentation. (Para 1 , 2 )
3. Correspondence regarding price lists does not constitute misrepresentation, and in the absence of fraud, the statutory six-month limitation for issuing a show cause notice applies. (Para 2 )
4. The statutory limitation period for issuing a show cause notice is applicable unless fraud or misrepresentation is proven. (Para 2 )
5. Appeal dismissed. (Para 3 )
6. When is a show cause notice for duty recovery barred by limitation?
A show cause notice is barred by limitation if issued beyond the statutory period, provided there are no allegations of fraud or misrepresentation. (Para 2 )
7. Does correspondence between parties regarding a price list constitute misrepresentation for the purpose of extending limitation?
No, correspondence between parties regarding a price list does not constitute misrepresentation. (Para 2 )
(1) THE question before the tribunal was :
"WHETHER the show cause notice issued on 14/9/1983 to recover duty in respect of clearances effected prior to 16/12/1982 is barred by limitation?"
(2) THE tribunal was of the view that the show cause notice could not be issued beyond a period of six months in the facts of this case. There was no allegation of any fraud or mis-representation. The only point stated on behalf of the Department was that some correspondence was going on between the two parties about the price list. That, however, does not constitute misrepresentation. The limitation of six months imposed by the statute for issuing a show cause notice is fully applicable to this case.
(3) WE are of the view that on the facts of this case, the tribunal has come to a right decision. The appeal is dismissed. No order as to costs.
