2007 (9) TMI 138 - AT - Central Excise

Assessee has already bought the matter to the notice of Asstt. Comm. under the letter that they are repacking bulk goods into smaller packs & labeling them with their own brand name So impugned order is set aside to the extent that it holds that the SCN was not time-barred Appeal rejected

Summary

Issues:
Classification of goods ZYGLO-ZP-4B and 9C RED, Time-barred show cause notice.

Classification Issue:
The appellants were re-packing chemicals into smaller packs and selling them as trading goods without paying duty. The Revenue argued that re-packing amounted to manufacture, leading to duty evasion. The adjudicating authority classified ZYGLO-ZP-4B under Chapter subheading 3206.40 and 9C RED under sub-heading 2812.90. The Appellate Commissioner upheld this classification, noting the suppression of facts by the appellants regarding the re-packing activity.

Time-barred Show Cause Notice Issue:
The appellant contended that they had intimated the Department about their re-packing activities on 28th July, 1992. They argued that this notification should have precluded the Revenue from invoking the extended period of limitation for issuing the show cause notice in 2000. The appellant relied on a Tribunal decision to support their claim that the notice was time-barred. The Department argued that the 1992 notification was insufficient as it did not accurately convey the manufacturing activity and misled the Department. They contended that the extended limitation period was correctly invoked.

Judgment:
The Tribunal clarified that the appellant did not dispute the goods' classification but focused on whether the 1992 intimation prevented the extended limitation period for the show cause notice. The Tribunal analyzed the 1992 communication, noting that it detailed the re-packing activities of ZYGLO-ZP-4B and 9C RED. The Tribunal found that this notification adequately informed the Revenue, allowing them to question the classification and initiate necessary actions. The Tribunal highlighted a previous order based on the same communication, where no suppression of facts was found. Therefore, the Tribunal concluded that the 2000 show cause notice was time-barred due to the 1992 notification providing sufficient information. As a result, the impugned order was set aside, and the appeal was allowed.

This comprehensive analysis highlights the classification and time-barred show cause notice issues, detailing the arguments presented by both parties and the Tribunal's reasoning leading to the judgment.