2013 (12) TMI 1346 - AT - Central Excise

Supply of Aromatic Compounds to various traders Waiver of Pre-deposit Held that - Appellant had filed affidavit/ certificates of various traders who have categorically stated that Aromatic Compounds purchased by them from the appellant are being sold to various small and tiny industrial units manufacturing Agarbatis etc. Following UOI vs. Garware Nylons Limited 1996 (9) TMI 123 - SUPREME COURT OF INDIA - the appellant had classified the product under Chapter heading 3302 on his knowledge of the product, if the department wants to reclassify the product under Chapter heading 3303, it is for the Revenue to adduce evidence to this regards - there was no evidence found which has been put forth by the Revenue for change of classification of the very same products which are cleared to the traders - Prima facie, the appellant has made case in their favour Pre-deposits waived till the disposal Stay granted.

Summary

Issues:
Classification of products under Chapter headings 3302 and 3303 for duty liability.

Analysis:
The appellant filed a stay petition seeking the waiver of pre-deposit of an amount, interest, and penalty imposed, confirmed as differential duty payable for misclassifying 'Aromatic Compounds' under Chapter heading 3302 instead of 3303. The appellant argued that the products were intended for industrial use, supported by labels and registration details. The Revenue alleged misclassification based on products supplied to traders not for industrial use. The appellant cited relevant case laws to support their classification. The departmental representative supported the lower authorities' findings.

Upon review, the Tribunal noted the issue centered on the supply of 'Aromatic Compounds' to traders. The appellant submitted affidavits from traders confirming industrial use of the products. The Tribunal observed the appellant's classification under Chapter heading 3302 and emphasized the Revenue's burden to provide evidence for reclassification under Chapter heading 3303. Finding no such evidence presented, the Tribunal granted the waiver of pre-deposit, staying the recovery pending appeal disposal.

In conclusion, the Tribunal allowed the appellant's application for the waiver of pre-deposit, emphasizing the lack of evidence from the Revenue to support reclassification of the products supplied to traders. The decision was based on the appellant's classification, supported by trader affidavits, and the absence of evidence for a change in classification.