The Petitioner, M/s. Maxcare Laboratories is a company carrying on the business of producing perfumed hair oil and red tooth powder having its plant at Mancheswar Industrial Estate, Bhubaneswar. it's stated that the plant has been closed for since long and therefore the Petitioner has no business operation within the State of Odisha.
The primary impugned show cause notice was issued by the Commissioner, Central Excise and Customs proposing a requirement of excise duty within the sum of Rs.75,65,511 invoking the extended period of limitation as per the provision to Section 11A(1) of the Central Excise Act, 1944 and Rules 9 (2) of the Central Excise Rules, 1944. The SCN alleged that the Petitioner had curbed the production of perfumed hair oil and red tooth powder and removed surreptitiously the said excisable goods without payment of central excise duty during the year 1994-95.
The SCN further stated that in course of verification of the RT-5 returns of the Petitioner for the year 1994-95. it had been observed that the Petitioner had not shown the expected production as per the production norms which had been declared by letter dated 16th December 1995. The suppressed quantity, consistent with SCN, works bent 3,19,961.00 litres of perfumed hairdressing and 1,23,608 kg of red tooth powder which were in contravention of Rules 53, 173G, and 226 of the CE Rules.
The Petitioner replied to the SCN on 16th December 1995 submitting details of raw material/packing material also because of the tentative input-output ratio. consistent with the Petitioner, it had also submitted the statement on 3rd March 2000 before the Superintendent, Central Excise, Bhubaneswar-I Range stating that “they don't have any fixed input-output ratio thanks to wastage/variation in the quality of raw material”. The Petitioner didn't hear anything from the other Parties and every one of a sudden, quite 17 years afterwards 28th December 2017 received a fresh SCN on an equivalent issue concerning the sooner SCN dated 29th March 2000 and stating that a private hearing was fixed on 9th January 2018.
Mr Jagabandhu Sahoo, the counsel for the petitioner contended that ts case is being transferred to the ‘call book’, then seeking to revive it after 18 years, the other Parties have acted unreasonably particularly since the Petitioner couldn't have reasonably expected that the proceedings against it might be kept alive for these a few years with none action being taken. Also, the Petitioner can't be expected to preserve its records for these a few years and to be ready to answer an SCN after 18 years. No effective opportunity of defence is often afforded to the Petitioner in such proceedings.
The division bench is headed by judge S. Muralidhar and Justice S.K. Panigrahi ruled that it's not justified on a part of the authorities to revive adjudication proceedings against the Petitioner after 18 years of issuance of the SCN. Accordingly, the impugned SCN and therefore the notices are hereby quashed.