2010 (11) TMI 405 - AT - Central Excise

Waiver of pre-deposite - Notification No. 47/2002-C.E., dated 6-9-2002 - he appellants had suppressed the fact regarding manufacturing of pipe fittings as the required declaration submitted, refers merely to pipes as under Chapter heading refers to the pipes and not to the pipe fittings - Authorities have held there was no disclosure of the fact of manufacture of pipe fittings and even declaration did not disclose the relevant chapter sub-heading, with reference to the pipe fittings and that the same came to the knowledge of the Department pursuant to the audit report and subsequent investigation - In the absence of any materials which could point out the said findings either to be perverse or contrary to the records, find that no prima facie case has been made out for total waiver of the duty demanded under the impugned order - Decided against the assessee.

Summary

Issues:
1. Benefit of Notification No. 6/2002-C.E. denied to pipe fittings.
2. Allegation of suppression of facts regarding manufacturing of pipe fittings.
3. Classification of pipe fittings under different sub-headings.
4. Compliance with certificate requirement for intended use specified in the notification.

Analysis:

1. The appellants sought the benefit of Notification No. 6/2002-C.E., as amended under Notification No. 47/2002-C.E., for excise duty on pipes needed for water delivery. However, the benefit was denied to pipe fittings manufactured by the appellants, as the product was considered different from pipes. The appellants claimed compliance with all requirements and argued that there was no suppression of facts regarding their intention to claim the benefit only for pipe fittings.

2. The Departmental Representative alleged that the appellants had suppressed the fact of manufacturing pipe fittings, as the declaration submitted referred only to pipes, not pipe fittings. Reference was made to a Supreme Court decision to distinguish a previous case where both products were classifiable under the same sub-heading.

3. The authorities found that the pipe fittings manufactured by the appellants were classified under a different sub-heading from the one under which the products were sought to be cleared. It was held that the Department was unaware of the manufacture of pipe fittings until revealed during an audit inspection and subsequent investigation.

4. Regarding the certificate requirement, the District Magistrate's certificate stated the work involved laying pipes for water delivery. However, it did not explicitly satisfy the notification's requirement for the intended use of pipes for water delivery from source to plant and storage facility. The authorities held that there was no disclosure of manufacturing pipe fittings, and the Department learned about it through audit and investigation. As no evidence contradicted these findings, the appellants were directed to deposit the demanded duty with interest, while the penalty was waived pending appeal.

In conclusion, the judgment focused on the denial of benefits to pipe fittings under a specific notification, allegations of suppression of facts, classification discrepancies, and compliance with certification requirements for intended use. The decision emphasized the importance of accurate disclosure and compliance with notification conditions to claim benefits and avoid penalties.