2015 (10) TMI 892 - AT - Central Excise

Waiver of pre deposit - Denial fo SSi Exemption - whether the appellant was within his rights to raise alternative plea of classification issue of printed stationery as falling under Chapter 49, even though the said plea was not raised by them prior to issuance of the show-cause notice - held that - The entire idea of adjudication is to come to a fair conclusion. Even if the appellant had adopted the classification of the said printed stationery as falling under Chapter 48 prior to the proceedings initiated against them, they were well within their rights to challenge the said classification when the proceedings were for differential demand, which was raised against them. As such, we agree with the learned Commissioner(Appeals) to that effect and set aside the order of the original adjudicating authority and remand the matter to him for considering of said submission of the appellant and to re-adjudicate the matter accordingly. - Decided in favour of assessee.

Summary

Issues:
Classification of printed paper, classification of computer stationery, SSI exemption benefit notification, remand by Commissioner(Appeals), penalty imposition

Classification of Printed Paper:
The appellant was manufacturing printed paper classified under Chapter 49 with a NIL rate of duty. They were also producing computer stationery under Chapter 48, paying duty under SSI exemption. Revenue alleged excess clearance of computer stationery, triggering a higher SSI limit. The appellant argued they also cleared pre-printed stationery under Chapter 49 at NIL duty, impacting the SSI slab. Original authority ignored this, leading to a demand. The Commissioner(Appeals) recognized the appellant's right to contest but lacked remand powers. The Appellate Tribunal agreed the appellant could challenge the classification during demand proceedings, remanding the case for reconsideration.

Classification of Computer Stationery:
The dispute centered on whether the appellant could assert a different classification for printed stationery post-demand notice issuance. The Tribunal upheld the appellant's right to raise the classification issue during demand proceedings, emphasizing the need for fair adjudication. Despite the initial classification choice, the appellant could challenge it when faced with differential demand. The Tribunal set aside the original adjudicating authority's decision and instructed a re-adjudication considering the appellant's submissions.

SSI Exemption Benefit Notification:
The case involved the application of the SSI exemption benefit notification to the appellant's production of computer stationery. The appellant's contention regarding the classification of printed stationery under Chapter 49 impacted the utilization of the SSI slab for the computer stationery. The Tribunal's decision to remand the case for re-adjudication implied a review of the SSI exemption benefit application in light of the classification issue raised by the appellant.

Remand by Commissioner(Appeals):
The Commissioner(Appeals) acknowledged the appellant's right to contest the classification issue but lacked the authority to remand the case for further consideration. While upholding the original authority's decision, the Commissioner(Appeals) revoked the penalty imposed on the appellant. The Tribunal, however, deemed the remand necessary for a fair adjudication, thereby overturning the original decision and directing a re-evaluation based on the appellant's classification arguments.

Penalty Imposition:
The penalty imposed on the appellant was set aside by the Commissioner(Appeals) but the original adjudicating authority's demand decision was upheld. The Tribunal's ruling to remand the case for re-adjudication encompassed a review of the penalty imposition in light of the classification issues raised by the appellant. The decision to set aside the penalty indicated a partial relief for the appellant pending the re-evaluation of the classification matters.