2010 (12) TMI 561 - AT - Central Excise

Application for stay - Demand - Suppression of facts - Merely because declaration was filed on 3-12-99 which did not disclose the correct facts that would not prohibit the department from invoking the extended period of limitation, once it is revealed in the course of investigation that the facts disclosed in the declaration were not correct and there was a case of clandestine removal of the product - in the absence of prima facie case and taking into consideration overall conduct of the appellants in the matter, there is no case made out for waiver of duty - The clear observations of the adjudicating authority in this regard are that though it is claimed that amount of Rs. 53,500/- was deposited, the TR-6, which was produced by the appellants, related merely to a sum of Rs. 47,500/- and did not indicate that the same was relating to perfumed hair oil cleared during the period from June, 1998 to August, 1998, which is the relevant period - Decided against the assessee

Summary

Issues:
1. Stay of order passed by Commissioner (Appeals)
2. Classification of products under Chapter Sub-Heading No. 3003.39
3. Allegations of suppression of facts and duty evasion
4. Comparison with previous legal judgments
5. Barred claim by limitation and suppression of facts
6. Waiver of duty and deposit made by the appellants

Stay of Order:
The appellants sought a stay of the order passed by the Commissioner (Appeals) confirming the demand of duty, interest, and penalty against them. The appellants did not file a reply to the show cause notice, failed to appear before the adjudicating authority, and did not contest the proceedings despite repeated opportunities.

Classification of Products:
The appellants were engaged in manufacturing various products, including Ayurvedic oils. The dispute arose regarding the classification of the products under Chapter Sub-Heading No. 3003.39. The appellants claimed that their products should be classified as Ayurvedic medicaments based on previous legal judgments, while the authorities alleged suppression of facts and clandestine removal of products.

Allegations of Suppression and Duty Evasion:
The authorities found that the appellants had suppressed relevant facts regarding the ingredients of the products and cleared them clandestinely without paying duty. The Commissioner (Appeals) upheld these findings after re-assessment. The appellants argued that they had filed the required declaration and there was no suppression of facts.

Comparison with Previous Legal Judgments:
The appellants relied on previous legal judgments related to classification of similar products to support their case. However, the authorities highlighted differences in the ingredients used and manufacturing process, making those judgments inapplicable to the present case.

Barred Claim and Suppression of Facts:
The appellants contended that their claim was barred by limitation and there was no suppression of facts, citing a declaration filed in 1999. The adjudicating authority considered an unretracted statement by a partner of the appellant's firm admitting lack of proper records, which undermined the appellants' arguments.

Waiver of Duty and Deposit Made:
The appellants claimed to have already deposited a sum, but the authorities found discrepancies in the deposited amount related to the duty payable on the products in question. The lack of evidence supporting the appellants' claim led to the dismissal of their application for waiver of duty.

In conclusion, the application for a stay was dismissed, and the appellants were directed to deposit the entire amount under the impugned order within a specified period.