2010 (3) TMI 953 - AT - Central Excise

Summary

Issues:
1. Maintainability of reference made to the Larger Bench regarding the question of classification of strap-plaps.
2. Liability of the appellants to pay duty for the extended period of limitation.
3. Clearance of strap-plaps during the normal period of limitation.
4. Decision on the question of classification of strap-plaps.

Analysis:

Issue 1: Maintainability of reference to Larger Bench
The issue raised was whether the reference to the Larger Bench for the question of classification of strap-plaps was necessary. The Jt. CDR argued that the decision of the Larger Bench would not impact the ongoing de novo proceedings before the original authority. It was contended that the matter of classification was already settled by the CESTAT Chennai in a previous case involving the same parties and goods. The Jt. CDR emphasized that the classification issue had attained finality and could not be reopened. Additionally, it was highlighted that a related order had been appealed against and was pending before the High Court. The Division Bench had already decided that no duty was payable for the extended period, making the reference on classification purely academic.

Issue 2: Liability for Duty Payment
The Division Bench had previously ruled that the appellants were not liable to pay duty for the extended period of limitation. It was established that the impugned goods, strap-plaps, had not been cleared during the normal period of limitation, leading to the conclusion that no duty was chargeable for the extended period. The learned Counsel for the appellants confirmed the absence of clearance of strap-plaps during the normal period, further supporting the decision that no duty was payable.

Issue 3: Clearance of Strap-Plaps
It was established that there were no clearances of strap-plaps during the normal period of limitation, with clearances only occurring in a previous period. This fact was crucial in determining the liability for duty payment for the extended period.

Issue 4: Decision on Classification
Considering the submissions and the fact that the impugned goods had not been cleared during the normal period of limitation, the Tribunal declined to answer the reference made to the Larger Bench on the question of classification of strap-plaps. The decision was based on the understanding that answering the classification question would be an exercise in futility, as no duty was chargeable for the extended period due to the absence of clearance during the normal period.

In conclusion, the Tribunal decided not to answer the reference to the Larger Bench and directed the appeal papers to be placed before the regular Division Bench for further proceedings.