PER JUSTICE U.L. BHAT :

Collector of Central Excise, Pune, has filed this appeal against the order passed by the Collector (Appeals), Bombay, confirming the order passed by Assistant Collector, Pune, dropping certain demands under four show cause notices.

2. Respondent, engaged in the manufacture of Power-driven pumps (T.I. 30A) and Agitators (T.I. 68) has been purchasing electric motors. The dispute in the appeal relates to the period 1.4.1981 to 31.12.1983 and 1.4.1984 to 3.6.1984. During these periods, respondent was clearing Agitators along with electric motors, on payment of excise duty on the value of Agitators and clearing PD Pumps along with Electric Motors on payment of excise duty on the value of PD Pumps. Value of Electric Motors was not being included in the assessable value of Agitators and PD Pumps. Electric Motors were supplied along with Agitators or PD Pumps only at the request of buyers. Respondent was also clearing Agitators and PD Pumps without Electric Motors in cases where buyers did not require the latter. On 9.3.1984, Superintendent of Central Excise, Mahindra Owen Range issued two notices to respondent to show cause against demand of excise duty for the period 1.4.1981 to 31.12.1983 alleging that respondent had cleared 185 Electric Motors along with PD Pumps and with 23 Agitators without adding the value of the Electric Motors in the assessable value of PD Pumps or Agitators as the case may be. On 16.6.1984 and 9.7.1984 similar show cause notices for the period 1.1.1984 to 3.6.1984 had been issued. Respondent resisted the notices contending that Electric Motors not being parts of Agitators or PD Pumps and being bought out items supplied only at the option of buyers, the value of Electric Motors could not be added to the assessable value of such goods. It was also contended that a part of the claim was barred by time. Respondent was following invoice price procedure in regard to Agitators. It was pointed out that Tariff advice 33/77 dated 7.9.1977 required that only where a sub-mersible pump set containing also duty paid Electric Motor if cleared together after assembly from the factory, entire assembly would be liable for duty under T.I. 30A and did not apply to respondent.

3. Assistant Collector held that it is clear from tariff description that duty is attracted in PD pumps only and not prima movers, that is motors except in the case of Monobloc Pump set, that respondent was supplying bought out Electric Motors only where buyers asked for and even then they were not fitted to the P.D. Pumps or Agitators and hence the value of Electric Motors was not required to be added to the assessable value of PD Pumps or Agitators. He also held that proviso to Section 11A (1) of the Central Excises Act, 1944 (for short, the Act) was not applicable since there was no misstatement or suppression of facts. Collector (Appeals) agreed with the reasoning and conclusion of the Assistant Collector.

4. It is contended by Shri T.R. Malik, SDR that PD Pumps contain slot for fitting Electric Motors and neither PD Pumps nor Agitators can function without Electric Motor which is prime mover and hence must be regarded as integral part of the PD Pumps and Agitators and hence the value of Electric Motors has to be added to the assessable value of excisable goods in this case. According to him, non-disclosure of clearance of bought-out Electric Motors along with PD Pumps and Agitators was deliberate and with intention to evade duty and as such larger period of limitation under the proviso to Section 11A of the Act is available. These contentions are rebutted by learned counsel for respondent.

5. We will now consider the decisions relied on behalf of appellant. In Collector of Central Excise Vs. Lawkim Pvt. Ltd., 1987 (31) ELT 700 (T) the question was whether the value of TOP (Thermal Overloading Protectors) affixed to sets of stator and rotor was to be added to the assessable value of the latter. It was found that TOP was fixed in