2004 (6) TMI 557 - AT - Central Excise

Summary

Issues:
1. Classification of products as Speciality Oil or Lubricating Oil for exemption under Notification No. 120/84-C.E.
2. Time limit specified in Section 11A(1) of the Central Excise Act for demanding duty.

Analysis:

Issue 1: Classification of Products
In the appeal filed by M/s. Indian Oil Corporation Ltd., the main contention was whether their products should be classified as Speciality Oil or Lubricating Oil to qualify for the benefit of Exemption Notification No. 120/84-C.E. The Appellant argued that they had consistently filed classification lists claiming the exemption and that the Asst. Collector had approved these lists. The Collector (Appeals) had remanded the matter for further proceedings, indicating that the initial classification decision was not final. The Appellant maintained that there was no wilful misstatement or suppression of facts on their part. The Tribunal agreed, citing precedents that mere classification under a different heading does not imply intent to evade duty. They found that the extended period of limitation for demanding duty was not applicable, as the Appellant had complied with filing requirements. Consequently, the Tribunal set aside the demand as time-barred, without delving into the merits of the case.

Issue 2: Time Limit for Demanding Duty
The dispute also revolved around the time limit specified in Section 11A(1) of the Central Excise Act for demanding duty. The Appellant argued that the demand made in the show cause notice dated 20-3-91, covering the period from 19-1-86 to 19-3-1990, exceeded the normal 6-month period stipulated in the Act. The Tribunal concurred, ruling that the entire period fell outside the statutory limitation period. Therefore, they allowed the appeal on this ground, without addressing the substantive issues of classification.

In conclusion, the Appellate Tribunal CESTAT, New Delhi, in this judgment, resolved the issues of product classification and time limit for demanding duty in favor of the Appellant, setting aside the demand as time-barred due to the extended period beyond the statutory limit prescribed by Section 11A(1) of the Central Excise Act.