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2005 (1) TMI 548 - AT - Central Excise
Issues: Classification of poly coated paper under Chapter 48 or Chapter 39, computation of Differential Duty, application of longer period of limitation, grant of stay.
Classification of poly coated paper: The appellant's product, poly coated paper, was classified by the Revenue under Chapter 48. The appellant argued that their product, paper coated with plastic, fell under Heading No. 48.11, supported by a Circular issued in 1989 and a judgment of the Hon'ble Supreme Court. The Commissioner, however, changed the classification to Chapter 39, leading to a demand for Differential Duty and a 100% penalty. The appellant highlighted Chapter Note 1 of Chapter 48 to support their classification argument. Computation of Differential Duty: The appellant contended that the computation of Differential Duty was based on the Tariff Rate under Chapter 39 without considering the effective rate. They also argued against the application of a longer period of limitation, stating that the facts were already known to the Revenue. The appellant pointed out that proceedings against another similar manufacturer with identical facts had been dropped by the same Commissioner. Application of longer period of limitation: The appellant argued that the longer period of limitation of 5 years should not apply in their case since the facts were already known to the Revenue. They emphasized that similar proceedings against another manufacturer with identical facts had been dropped by the Commissioner, indicating inconsistency in application. Grant of stay: After hearing both sides, the Tribunal found merit in the submissions of the appellant's Sr. Advocate. The Tribunal granted total dispensation of the duty till further orders, indicating a favorable decision for the appellant. The case was scheduled for regular hearing on a specified date. This detailed analysis of the judgment from the Appellate Tribunal CESTAT, Kolkata, highlights the key issues of classification of poly coated paper, computation of Differential Duty, application of the longer period of limitation, and the grant of stay in favor of the appellant based on the arguments presented and the Tribunal's assessment of the submissions made by both parties.
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