2011 (3) TMI 1190 - AT - Central Excise

Classification - non filing price list/declaration or declaring price on invoices as required under Rule 173C - violaion of principle of natural justice - Held that - As the appellants were given ample opportunity for hearing but the appellants failed to appear before the adjudicating authority, therefore the adjudicating authority left no option but to decide the case on the basis of the documents in hand. So the ground that principles of natural justice has been violated is not sustainable. As the issue of classification of the product was not the issue before the adjudicating authority therefore the adjudicating authority has not looked into that issue. As the issue of classification has been admitted by this Tribunal, therefore it would be appropriate and in the interest of justice that the issue of classification is to be considered by the adjudicating authority first - remand back this matter to the adjudicating authority to classify the product in appropriate chapter heading.

Summary

Issues involved:
Challenge to impugned order confirming demand, interest, and penalty; Classification of goods under Chapter 71 of CETA; Violation of principles of natural justice.

Analysis:

1. Challenge to impugned order:
The appellants contested the demand, interest, and penalty confirmed against them in the impugned order. The allegations included non-filing of correct particulars, price list, accounting for goods, determining appropriate Central Excise duty, payment of duty, issuance of Central Excise invoice, and non-filing of return. The advocate for the appellants argued that the issue of classification was not contested before the lower authorities but was raised during stay proceedings before the Tribunal. The appellants claimed that their manufactured articles fall under Chapter 71 of the Central Excise Tariff Act, entitling them to exemption. The Tribunal considered this contention during the stay application and allowed the appellants' claim regarding classification. Therefore, the first issue to decide was whether the articles manufactured by the appellants are covered under Chapter 71 of CETA.

2. Violation of principles of natural justice:
The appellants raised a concern that the impugned order violated the principles of natural justice as they were not given a reasonable opportunity to present their case. The advocate requested the matter to be remanded back to the adjudicating authority for de novo adjudication. However, upon hearing and consideration, the Tribunal found that the appellants were given ample opportunity for a hearing, but they failed to appear before the adjudicating authority. Consequently, the adjudicating authority had to decide the case based on the available documents. The Tribunal concluded that the ground alleging a violation of natural justice was not sustainable. Additionally, the issue of classification was not considered by the adjudicating authority as it was not raised before them. Therefore, the Tribunal decided to remand the matter back to the adjudicating authority to classify the product under the appropriate chapter heading and issue an order after providing an opportunity to the appellants. All other issues were kept open for further consideration.

3. Conclusion:
In conclusion, the Tribunal allowed the appeal by way of remand, directing the appellants to appear before the adjudicating authority to fix a date for the final hearing of the matter. The decision to remand the issue of classification back to the adjudicating authority was made in the interest of justice to ensure a proper determination based on the claims made by the appellants during the stay proceedings.