2017 (7) TMI 674 - AT - Central Excise

Classification of goods - dental plate brushes - Deemed manufacture - assessee is emphasizing that the items tooth brushes and inter-dental brushes are in separate category. The tooth brush is available on any grocery shop whereas inter-dental brush is available only at a chemist shop - whether dental plate brushes can be said to be covered under the entry of Sr.No. 97 A of the Third Schedule to the Central Excise Act, 1944? - Held that - the subject item, inter-dental brush of any kind is also a tooth brush and is used as an item for cleaning teeth. It is true that the item inter-dental brush or dental plate brush is not easily available at any grocery shop; the same is available only at a chemist shop. However, both are tooth brushes and both are covered by the Central Excise Tariff heading no. 96032100. Though it is true that inter-dental brush is specifically not mentioned in the entry 97A of the Third Schedule to Central Excise Act, 1944, Tariff sub-heading 96032100 is mentioned therein. Once Tariff sub-heading 96032100 is mentioned with the description tooth brush, one cannot arrive at the conclusion that inter-dental brush or dental plate brush is not part of that entry or the said description, when dental-plate brush is also a kind of tooth brush. Therefore, it is held that subject item is covered by entry at Sr. No.97A of Third Schedule to C.E. Act, 1944 - demand of excise duty upheld. Extended period of limitation - Held that - subject matter is a matter of interpretation of law. Therefore, the demand beyond the normal period is not sustained and for the same reason no penalty is liable to be imposed on the assessee. The duty for the normal period only is confirmed along with interest. The subject matter is remanded for limited purpose to original adjudicating authority, who shall quantify the duty payable for the normal period along with interest payable under section 11 AB Central Excise Act 1944 - appeal allowed in part by way of remand.

Summary

Issues: Classification of Tooth Brush and Inter-dental Brushes under Central Excise Tariff

Classification Issue:
The main issue in this case is the classification of tooth brushes and inter-dental brushes under the Central Excise Tariff. The appellant contested the demand of duty on these items, arguing that inter-dental brushes should not be classified under the same entry as tooth brushes.

Analysis:
The Central Excise Tariff includes tooth brushes under heading 96032100, with a specific entry for tooth brushes in the Third Schedule to the Central Excise Act. The appellant argued that inter-dental brushes, although falling under the same heading, should not be considered tooth brushes as they are not explicitly mentioned in the entry. However, the tribunal held that inter-dental brushes are indeed a type of tooth brush, as they are used for cleaning teeth, and are covered by the same tariff heading. Despite inter-dental brushes not being easily available at grocery shops like regular tooth brushes, they are still classified under the same heading and subject to excise duty.

Interpretation of Law and Time Limitation Issue:
Another issue raised was the interpretation of law regarding the time limitation for duty payment. The appellant argued that the extended period of limitation should not apply, and no penalty should be imposed due to the matter being a question of interpretation.

Analysis:
The tribunal considered the case as a matter of interpretation of law, citing a previous decision where duty was payable only for the normal period in similar circumstances. It was held that the extended time period should not be invoked, and no penalty should be imposed on the appellant. Interest was deemed payable for the duty upheld during the normal period.

Decision:
The tribunal modified the impugned order, confirming duty payment for the normal period along with interest under section 11 AB of the Central Excise Act. The matter was remanded to the original adjudicating authority to quantify the duty payable for the normal period after providing the appellant with an opportunity for a personal hearing and document submission.

In conclusion, the classification of inter-dental brushes as tooth brushes under the Central Excise Tariff was upheld, and the interpretation of law regarding duty payment and time limitation favored the appellant, resulting in duty payment for the normal period only without any penalty.