2015 (10) TMI 1832 - AT - Central Excise

Denial of exemption claim - Classification of goods - Held that - For availing the exemption Notification Nos. 49/2003-C.E. and 50/2003-C.E., filing of the declaration in prescribed format to Assistant/Deputy Commissioner, with a copy to the Superintendent of Central Excise is mandatory and as the exemption is applicable only from the date of filing of the declaration, in our view, this condition for availing the exemption has been substantially complied with by sending the declaration to the jurisdictional Superintendent of Central Excise about which there is no dispute. The jurisdictional Superintendent could have passed to the Assistant Commissioner s office and just because the copy of the declaration was not sent by the assessee to the jurisdictional Assistant Commissioner/Dy. Commissioner, the exemption cannot be denied. As regards the second objection that the Tariff Heading mentioned in the declaration is 8517 50 30 while there is no such Tariff heading, in our view this is a clerical mistake as there is no dispute about the description and nature of the product being manufactured and on the basis of the description, the product would be classifiable as Data Processing Machine under Heading No. 8474 which are covered by the exemption Notification No. 49 - 50/2003-C.E. Just on account of some clerical mistake in mentioning of the sub-heading, the benefit of the exemption notification cannot be denied. - Decided in favour of assessee.

Summary

Issues:
1. Exemption eligibility under Notification No. 49/2003-C.E.
2. Compliance with declaration requirements.
3. Classification of goods under Central Excise Tariff.

Exemption Eligibility under Notification No. 49/2003-C.E.:
The appellant, a manufacturer of electricity meter reading instruments, sought exemption under Notification No. 49/2003-C.E. for their products classified under Heading No. 8471 as data processing machines. The dispute arose when the department questioned the appellant's eligibility due to procedural lapses. The jurisdictional Superintendent initially allowed the exemption, but later, the department contended that the appellant failed to send the declaration to the Assistant/Deputy Commissioner as required. The appellant also mistakenly mentioned a non-existent Tariff Entry in the declaration. Consequently, duty demands, interest, and penalties were imposed. The Tribunal noted that the goods were correctly classified, and the declaration was sent to the Superintendent, fulfilling a significant part of the requirement. The Tribunal held that the failure to send a copy to the Assistant Commissioner did not warrant denial of exemption.

Compliance with Declaration Requirements:
The Tribunal emphasized that for availing exemptions under Notification Nos. 49/2003-C.E. and 50/2003-C.E., filing the declaration to the Assistant/Deputy Commissioner with a copy to the Superintendent is mandatory. While acknowledging the procedural error of not sending a copy to the Assistant Commissioner, the Tribunal deemed that substantial compliance was achieved by sending the declaration to the jurisdictional Superintendent. The Tribunal reasoned that the Superintendent could have forwarded the declaration to the Assistant Commissioner's office. Therefore, the failure to send a copy to the Assistant Commissioner did not invalidate the exemption claim.

Classification of Goods under Central Excise Tariff:
Regarding the incorrect Tariff Heading mentioned in the declaration, the Tribunal considered it a clerical mistake. Despite the erroneous sub-heading, the nature and description of the product aligned with being classified as a "Data Processing Machine" under Heading No. 8474, covered by the exemption Notification. The Tribunal held that denying the exemption solely based on a clerical error was unwarranted. Consequently, the Tribunal set aside the duty demands, interest, and penalties imposed by the Commissioner, ruling in favor of the appellant. The appeals were allowed, and the impugned orders were deemed unsustainable.