P.K. Desai, Member (J)

1. This appeal is direct against the order-in-appeal bearing No. M-1610-1611/81, 552, 553/84, dated 18-7-1984, confirming the order-in-original No. V-34 (15) 3/81/403 & V-34 (15) 4-81/4035 both dated 26-8-1983 and demanding Rs. 46,232.58 towards the excise duty payable on export of eight agricultural tractors to Nepal.

2. The Government of India, vide Finance Department Circular No. 297/2/77 CX-9, dated 23-9-1977, decided to allow "in bond" export of excisable goods to Nepal without charging excise duty where the payment was to be received in free foreign exchange. The Government also, vide Notification No. 304/77, dated 24-10-1977 made amendment in Rule 13 of the Central Excise Rules, by incorporating Sub-rule (2), enabling the Government to permit such export without charging duty and Trade Notice No. 248 (MP)/Gen/36/77 dated 14-12-1977 was issued laying down the procedure to be followed for availing of such benefit.

3. The appellants, who are the manufacturers of Agricultural Tractors, falling within T.I. No. 34 of the Central Excise Tariff, and are holding the L-4 licence, received, in Jan.-Feb. 1981, order from Nepal for 5 units of 444 type of Agricultural Tractors, and they opened L/C on 28-1-1981 for the same with the State Bank of India. Subsequently thereafter, they received an additional order for 3 units of tractors of B-275 models, and opened L/C with the same bank on 28-8-1981 for the same, with a view to avail of the facility of "in bond" export without payment of excise duty, the appellant applied to the Jurisdictional Collector of Central Excise as per the procedure prescribed, for grant of permission to export the same under "in bond" facility, and they were granted the permission vide Department's letter dated 26-2-1981 and 21-4-1981 the appellants accordingly executed B-l bonds on 28-2-1981 and 29-4-1981 which were accepted and export. was permitted. The tractors were accordingly exported on 30-4-1981. Payment thereof was received in free foreign exchange and certificate to that effect was issued by the State Bank of India which was placed before the Jurisdictional Assistant Collector with a request to release the appellants from the liability under the bond.

4. On 3-7-1981 the Collector of Central Excise & Customs, issued a Trade Notice, informing that "in bond" export to Nepal was withdrawn, and earlier Trade Notice, therefore, stood cancelled.

5. The Jurisdiction Assistant Collector vide No. CE/RI1/D No. 1/M&M/TT/81/617 dated 15-7-1981 issued notice of demand, demanding Rs. 46,232.58 mentioning therein that the export to Nepal under "in bond" facility was discontinued after 21-11-1980 as per instructions issued by the Central Board of Revenue, and as the tractors in question were exported after that date, the amount was demanded. The said notice was issued under Rule 13 of the Central Excise Rules, 1944. The appellants submitted reply to the said notice of demand and explained that the export was in pursuance of the Govt. Circular dated 23-9-1977 and the Trade Notice dated 14-12-1977, and that the export was under express permission granted by the competent authority. They also pleaded that it was only under the Trade Notice dated 3-7-1981 that the facility stood withdrawn, whereas the export was prior to the same. They also pleaded that no such demand could be raised without issue of notice to show cause under Section 11A of the Central Excises & Salt Act, 1944. They also pleaded promissory estoppel.

6. After granting personal hearing, the Assistant Collector vide his order dated 23-6-1983, confirmed the demand, holding that notice was a show cause-cum-demand notice, and that the principles of natural justice have been fully met with by giving prescribed hearing though same was not asked for. In his view principles of promissory estoppel did not apply in relation to revenue matters. He also held that Rule 13 of the Rules contemplates issue of Notification by the Government of India