2002 (1) TMI 422 - AT - Central Excise

Summary

Issues:
Classification of the product under different tariff items, duty demand, validity of show cause notices, affirmation of tribunal's judgment by higher courts.

Classification Issue:
The appellants were manufacturing Olemessa baby massage oil and initially classified it under sub-heading No. 3304 of the CETA. The Revenue contested this classification, wanting it under Tariff Item 14F(i) of the erstwhile Tariff. Subsequently, different classification lists were filed by the appellants, leading to show cause notices for reclassification. The Tribunal's Final Order No. 148/90-C determined the product to be classifiable under Tariff Item 12 of the erstwhile Tariff, a decision upheld by the Apex Court. The Assistant Collector then released the security held against provisional assessments, and the Classification Lists were finally approved under sub-heading 1508.90 of the CETA based on the Tribunal's judgment. The demand raised by the Revenue was dropped by the authorities following the Tribunal's classification decision, which had been affirmed by higher courts.

Duty Demand Issue:
The Revenue issued show cause notices for demanding differential duty, alleging misclassification of the product under Tariff Item 68 of the erstwhile Tariff. However, the Asstt. Commissioner made a final assessment under Sub-heading 1508.90 of CETA in favor of the appellants, a decision not appealed against. As the classification issue was conclusively settled in favor of the appellants by the Tribunal's judgment, the demand for differential duty was rightfully dropped by the authorities based on the Tribunal's decision.

Validity of Show Cause Notices Issue:
Show cause notices were issued at various points for reclassification and duty demands. The Asstt. Commissioner's order under Sub-heading 1508.90 of CETA, in line with the appellants' claim, was not appealed against, solidifying the classification in favor of the appellants. The Collector (Appeals) upheld the dropping of the demand based on the Tribunal's judgment, finding no legal infirmity in the decision. The impugned order was upheld, and the Revenue's appeal was dismissed for lacking merit.

In conclusion, the judgment by the Appellate Tribunal CEGAT, New Delhi dealt with issues surrounding the classification of a product under different tariff items, duty demands raised by the Revenue, the validity of show cause notices, and the affirmation of the Tribunal's classification decision by higher courts. The decision ultimately favored the appellants, upholding the Tribunal's classification determination and dismissing the Revenue's appeal for lacking merit.