2008 (4) TMI 625 - AT - Central Excise

Demand - Time Limitation - Misdeclaration - Held that - The demand is for the period 24-2-97 to 28-2-2000 and show cause notice was issued on 4-3-2002 by invoking extended period of limitation on the ground of suppression of facts with intent to evade payment of duty - the demand is time barred - appeal allowed - decided in favor of appellant.

Summary

Issues:
1. Classification of goods under Central Excise Tariff Act.
2. Time bar for demand of duty.
3. Allegation of suppression of facts with intent to evade payment of duty.

Classification of Goods:
The appeal was filed against an order confirming a demand and penalty on the classification of Flexible Hose, Showers, Spouts, and Bottle Traps under specific headings of the Central Excise Tariff Act. The appellant did not contest the classification but argued that the demand was time-barred. The appellant had filed a classification declaration under Rule 173B, specifying the manufacture of Sanitary Fittings and claimed classification under a particular chapter of the Tariff. They cleared goods under this classification in invoices and filed RT-12 returns accordingly. The revenue sought to classify the goods differently, but the appellant's compliance with declaration and returns showed no intent to evade duty.

Time Bar for Demand:
The revenue alleged that the appellant suppressed facts with intent to evade duty by not declaring specific items in the classification declaration. However, it was noted that the appellant manufactured various sanitary fittings, and the revenue raised concerns about only four items. The demand covered a period, and a show cause notice was issued invoking an extended period of limitation due to alleged suppression of facts. The appellant had filed necessary declarations, cleared goods under specified classifications, and filed RT-12 returns, which were all in order. As the appellant had complied with declaration requirements and no intent to evade duty was evident, the demand was considered time-barred.

Allegation of Suppression of Facts:
The appellant's manufacturing activities included various sanitary fittings, with the revenue focusing on specific items. The appellant's argument centered on the time-bar issue, supported by their compliance with declaration rules and proper documentation of goods cleared. The Tribunal found that the revenue's allegation of mis-declaration or suppression of facts to evade duty was not substantiated. Consequently, the demand was deemed time-barred, and the impugned order was set aside, allowing the appeal.

This detailed analysis of the judgment addresses the issues of classification of goods, time bar for demand of duty, and the allegation of suppression of facts with intent to evade payment of duty, providing a comprehensive understanding of the legal reasoning and decision-making process involved in the case.