2016 (9) TMI 1448 - AT - Central Excise

Time limitation - Classification of goods - Batting Gloves, Wicket Keeping Gloves, Batting Inners & Wicket Keeping Inners - whether classified under Chapter 95 or not? - Held that - Held that - The issue is fully covered by our earlier decision in the case of, M/s. Sanspareils Greenlands Pvt. Ltd. v. Commissioner of Central Excise, Meerut 2016 (9) TMI 1230 - CESTAT ALLAHABAD , where it was held that the said demand was hit by limitation. Even if the classification issued is not finalized the demand in the present case gets hit by limitation for the period up to February, 2012. For the month of March, 2012 the appellant has paid duty at full rate therefore, under Section 11A(2B) of Central Excise Act, 1944, the show cause notice issued for the month of March, 2012 does not survive - Demand up to the period of February, 2012 is hit by limitation and for demand for the month of March, 2012 the show cause notice does not survive in view of Section 11A(2B) of Central Excise Act, 1944. Appeal allowed - decided in favor of appellant.

Summary

Issues:
Classification of goods under Central Excise Tariff Act, 1985; Applicability of Chapter Heading No. 9506; Limitation period for demand of Central Excise duty; Imposition of penalty on Managing Director.

Analysis:
The case involved two appeals filed by M/s. Sunridges Sporting Goods Pvt. Ltd. and the Managing Director against an Order-in-Original passed by the Commissioner of Central Excise & Customs, Meerut-I. The dispute revolved around the classification of goods used for sports purposes, such as Batting Gloves, Wicket Keeping Gloves, Batting Inners, and Wicket Keeping Inners, under Chapter Heading No. 9506 of the Central Excise Tariff Act, 1985. The Revenue contended that these goods were excluded from Chapter 95, leading to a show cause notice being issued proposing to classify them under Tariff Item No. 4203 21 10 and demanding Central Excise duty amounting to ?2,08,64,843 for the period from March 2011 to March 2012. The appellants had paid a portion of this duty under protest, and penalties were proposed on the Director as well.

The appellants challenged the Order-in-Original before the Tribunal, arguing that the demand up to February 2012 was time-barred, citing a similar case precedent where a demand was held to be hit by limitation. They had paid the full rate of duty for March 2012 under protest, withdrawing the protest during the proceedings. The Departmental Representative contended that the show cause notice was valid for determining the duty classification despite the limitation issue.

The Tribunal considered the arguments and referred to its earlier decision in a similar case, where it was held that the demand was time-barred. It was noted that the goods in question had been classified under Chapter Heading No. 9506 in previous notifications, supporting the classification argument. As the demand up to February 2012 was found to be hit by limitation, and the duty for March 2012 had been paid in full, the show cause notice for March 2012 did not survive under Section 11A(2B) of the Central Excise Act, 1944. Consequently, the appeals were allowed, and the appellants were entitled to any consequential relief as per the law.

In conclusion, the Tribunal ruled in favor of the appellants, holding that the demand up to February 2012 was time-barred and the show cause notice for March 2012 did not survive. The classification issue was not addressed, and the appellants were granted relief in accordance with the law.