S. Kalyanam, Member (J)

1. Shri S.K. Srinivasan, the Liaison Officer of the appellant-company appearing on behalf of the appellant-company submitted that out of the total tax of Rs. 57,358.71, the appellant has already deposited a sum of Rs. 28,679.36. In respect of the balance, it was urged that the appellant unit is a small scale industry and finished products worth about Rs. 63,000/- is already in the custody of the Central Excise Department and the industry itself remained closed for the past two years. Since the appeal itself is posted today and since 50 per cent of the duty has already been deposited, in the circumstances, we dispense with the prior deposit of the duty amount pending disposal of the appeal today.

This appeal is directed against the Order of Collector of Central Excise (Appeals), Madras, dated 11-1-1985 confirming the order of the Assistant Collector of Central Excise, Bangalore dated 27-8-1984 raising a demand on the appellant for a sum of Rs. 57,358.71 as duty amount due in respect of the appellant's clearances effected between June 1980 to August 1982 for the manufacture of excisable goods such as re-rolled iron and steel products. The short question that arises for our consideration in the appeal is whether the demand made on the appellant by the Department 'by invoking the extended period of limitation in terms of Section 11A(1) of the Central Excises and Salt Act, 1944 is tenable in law and whether there are materials available on record to indicate that the appellant is guilty of suppression of certain facts within the meaning of Section 11A(1) so as to clothe the Department with the right to invoke the extended period of limitation. The original authority as well as the lower appellate authority have held that the appellant has suppressed particulars with reference to raw materials, such as runners and risers which have been admittedly used by the appellant in the manufacture'- of re-rolled iron and steel products. The case of the Department is that the appellant has cleared re-rolled iron and steel products without payment of any duty claiming the benefits of exemption in terms of Notification No. 206/63-CE dated 30-11-1963 (as amended). It is a common ground that runners and risers are items which are excluded from the purview of exemption notification referred to supra and it is also not disputed by the appellant that they used the runners and risers as raw materials in the manufacture of finished products, namely., re-rolled iron and steel goods.

2. Shri Srinivasan contended that the Department knew that the appellant was using runners and risers as raw materials in the manufacture of finished goods, namely, re-rolled iron and steel products and this fact is evidenced by the raw materials register. It was urged that the raw materials register (Form IV) has also been signed by the Central Excise authorities on 1-5-1981 and the same has also been scrutinised by the audit authorities of the Central Excise Department, as evidenced by the audit report of the Central Excise Department dated 16-2-1982. It was therefore contended that since the Department knew well that the appellant was using runners and risers as raw materials and did not levy any duty or raise any demand within the statutory period of limitation, the claim now made by the Department and confirmed under the impugned order is clearly barred by limitation in terms of Section 11A of the Act.

3. Shri K.M. Vadivelu, the learned Departmental Representative contended that in terms of Rule 173D, the appellant ought to have furnished the principal raw materials used in the manufacture of finished products and since the same was not furnished, the appellant is guilty of suppression of facts entitling the Department to invoke the extended period of limitation under Section 11A(1) of the Act. The learned Departmental Representative further urged that the normal practice is to give particulars of raw materials used in the manufacture of finishe