2009 (3) TMI 698 - AT - Central Excise

Summary

Issues:
Classification of "Pizza" under Central Excise Act, 1944 - Applicability of penalties under Sections 11AC and Rules 25, 26 of Central Excise Rules - Invocation of longer period for demand of dues.

Classification Issue:
The appellant contended that "Pizza" should be classified under Chapter 19 as a bakery product, exempted from duty, while the department argued for classification under Chapter 16.01 as a preparation of meat. The appellant emphasized that their product is not packed in a unit container, as per the definition under the Central Excise Tariff Act, 1985. They cited a favorable decision by the Commissioner (Appeals) in their case and argued that when two views are possible, the longer period for demand cannot be invoked. The department, however, argued that the unit container is designed to hold a specific quantity, and since the container in question holds one pizza, the appellant's classification claim lacks merit.

Penalty Applicability Issue:
The impugned order required the appellants to pre-deposit substantial amounts as duty, penalty under Section 11AC, and penalties under Rules 25 and 26 of the Central Excise Rules. The appellant sought a waiver of these dues, citing the favorable decision in their case, different interpretations by departmental authorities, and the inapplicability of the longer period. The Tribunal, after considering the arguments, ordered a full waiver of the demanded dues and stayed any coercive measures until the appeal's disposal, relying on a Supreme Court judgment for the stay's duration.

Longer Period Invocation Issue:
The Tribunal noted that the merits of the case should be examined during the final hearing and that the appellant currently has a decision in their favor. Due to conflicting interpretations by authorities, the Tribunal found that prima facie, the longer period for demand would not apply. Consequently, the Tribunal ordered a full waiver of the dues and stayed any coercive actions, extending the stay beyond 180 days as per a relevant Supreme Court precedent. The matter was scheduled for further hearing on a specified date.