2017 (4) TMI 684 - AT - Central Excise

Classification of goods - Tamarind Kernal Powder (TKP) - classifiable under Chapter sub-heading 1101.00 of CETA 1985 or under Chapter sub-heading 1301.10? - Held that - this Tribunal in the appellant s own case M/s Hindustan Gum & Chemicals Ltd. Versus CCE Ahmedabad 2012 (7) TMI 748 - CESTAT NEW DELHI after analyzing the process of manufacture relevant tariff entry and HSN Notes concluded that the product TKP is classifiable under Chapter sub-heading13.01 of Central Excise Tariff Act 1985 - the matter is remanded to the adjudicating authority to re-compute the demand - appeal allowed by way of remand.

Summary

Issues: Classification of goods under Central Excise Tariff Act, 1985; Cum-duty price benefit entitlement; Extended period of limitation for duty demand.

Classification Issue:
The appeal involved a dispute regarding the classification of Tamarind Kernel Powder (TKP) by the Respondent, a manufacturer of excisable goods. The Revenue contended that TKP should be classified under Chapter sub-heading 1301.10, attracting an 8% duty rate, while the Respondent had cleared it under Chapter sub-heading 1101.00, with a 'nil' duty rate. The Commissioner (Appeals) had initially ruled in favor of the Respondent, but the Tribunal reconsidered and classified TKP under sub-heading 13.01 of the Central Excise Tariff Act, 1985, based on the manufacturing process and relevant tariff entries. The Tribunal also allowed the Respondent the benefit of cum-duty price realization and Modvat credit for duty paid on inputs.

Cum-Duty Price Benefit:
The Revenue acknowledged that the Respondent was entitled to the cum-duty price benefit after the classification decision was made in favor of the Revenue. The Tribunal upheld this benefit for the Respondent, indicating that the revised duty liability should be recalculated by the adjudicating authority considering the cum-duty price realization.

Extended Period of Limitation:
Regarding the extended period of limitation for duty demand, the Tribunal held that demands made beyond the statutory time limit were not maintainable. The Tribunal set aside the impugned order and remanded the matter to the adjudicating authority to re-compute the demand in accordance with the Tribunal's decision on classification and the benefits allowed to the Respondent.

The Tribunal's decision in this case reaffirmed the classification of TKP under sub-heading 13.01 of the Central Excise Tariff Act, 1985, granted the Respondent the cum-duty price benefit and Modvat credit, and rejected the demands made beyond the permissible time limit. The appeal was disposed of accordingly, with the matter remanded for re-computation of the demand based on the Tribunal's observations and decisions.