S. Duggal, Member (J)

1. This appeal to the Tribunal is directed against an order passed by the Collector of Central Excise, Pune on 3-10-1983 whereby he reviewed the order dated 18-11-1980 passed by Assistant Collector, Central Excise, Pune. The impugned order of the Collector was passed in pursuance to Review Notice having been served bearing the date 13-11-1981 in exercise of the power vested in him under Section 35A(2) of the Central Excises and Salt Act, 1944, as it then existed, (hereinafter referred to as the Act).

2. The facts, so far as relevant to the controversy now before us, are that the Assistant Collector had served two successive notices on the appellants, one dated 12-3-1980 and the other dated 16-5-1980 raising demand for butter, pasteurised/unpasteurised, alleged to have been manufactured, and cleared by the Military Dairy Farm, Kirkee, Pune (appellants herein) during the period 1976-77 to 31-3-1980. The Assistant Collector, after consideration of the material before him, confirmed the demand of duty with reference to non-pasteurised butter, only for the period 18-6-1977 to 31-3-1978 which came to Rs. 5053.40. He held other clearances, which were subject-matter of the notices of demand, to be exempt from duty partly by reference to the Exemption Notification No. 215/77 dated 15-7-1977, and partly by virtue of Notification No. 71/78 dated 1-3-1978. Consequently, only demand for Rs. 5053.40 under Rule 10(1) (a) of the Central Excise Rules, 1944 was confirmed by means of the said order, passed by the Assistant Collector.

3. The Collector, however, on examination of the records and the order, felt that the Assistant Collector had erred in giving benefit of the Notification No. 71/78 to the assessee inasmuch as the goods manufactured and clearances made in all the Military establishments all over India had to be taken into account and it was for the assessee to have satisfied that the proceeds of all such establishments did not exceed the limit prescribed by the Notification. In respect to Notification No. 215/77 dated 15-7-1977, the Collector opined that the Assistant Collector had wrongly excluded the whole quantity of unpasteurised butter cleared during the period prior to issue of this Notification, and that it was also liable to excise duty; besides the special excise duty leviable from 1-3-1978 which also, in his view, had to be included in the demand of duty amounting to Rs. 5,053.40, as determined by the Assistant Collector.

4. This Review Notice was confirmed by order dated 3-10-1983, and it is this order which is assailed in this appeal, on a number of grounds; the foremost being that there was a clear restriction on the power of the Collector to issue review notice on account of non-levy or short levy within a period of six months, from the date of the order which is sought to be reviewed, which limitation was provided by Sub-section (3)(b) of Section 35A, with reference to which the Collector had exercised his power to review the Assistant Collector's order. It was pleaded that the notice having been issued on 13-11-1981 whereas the original order was passed on 18-11-1980, on this ground alone, the order of the Collector was liable to be set aside. It was, however, further pleaded that there was no wilful mis-statement or fraud or suppression of facts on the part of the appellants, and that even the original demands were barred by time, so far as they related to a period beyond six months of the respective notices, as only the normal period provided by Rule 10(1) was available to the Department, while making original demands, and that no circumstance existed justifying, recourse to the larger period as provided by proviso to Rule 10(1).

5. At the time of hearing, Shri M. Chandrashekharan, Advocate appeared for the appellants, and although broadly the facts were referred to but the learned counsel, at the outset, made it clear that he rested his case on the plea of time-bar, qua the review notice, as a