2009 (5) TMI 651 - AT - Central Excise

Summary

Issues:
Classification of fruit juice under Chapter Heading 22.02 vs. Chapter Heading 2001.10.
Validity of Notification No. 16/91-C.E. (N.T.) issued under Section 11C of the Central Excise Act, 1944.

Classification Issue:
The appeal involved a dispute regarding the classification of fruit juice manufactured by the assessee under Chapter Heading 22.02, as opposed to the classification claimed by the assessee under Chapter Heading 2001.10. The Commissioner of Central Excise (A) had set aside a demand of Rs. 2,59,544/- confirmed against the assessee by the Assistant Commissioner. However, the Appellate Tribunal found that it was unnecessary to delve into the classification issue due to the existence of Notification No. 16/91-C.E. (N.T.) issued under Section 11C of the Central Excise Act, 1944. This notification provided an exemption to fruit pulp based drinks falling under Heading No. 22.02 during a specific period. The Tribunal, after considering the notification, concluded that no demand could be sustained against the respondents based on the classification issue, thereby rejecting the appeal of the revenue.

Notification Validity Issue:
The crux of the judgment revolved around the validity and applicability of Notification No. 16/91-C.E. (N.T.) issued by the Central Government under Section 11C of the Central Excise Act, 1944. The notification specifically addressed the exemption to fruit pulp based drinks falling under Heading No. 22.02 during a specified period due to a prevalent practice regarding the levy of excise duty. The Tribunal, after a thorough examination of the notification, held that the exemption provided therein shielded the respondents from the demand raised by the revenue. By invoking the provisions of the notification, the Tribunal concluded that the duty of excise, which was short-levied during the specified period, was not required to be paid by the respondents. Therefore, the Tribunal upheld the validity of the notification and ruled in favor of the respondents, dismissing the appeal of the revenue.

This comprehensive analysis of the judgment highlights the pivotal issues of classification and the validity of the notification, elucidating the Tribunal's reasoning and decision-making process in resolving the appeal.