2019 (3) TMI 1487 - AT - Central Excise

Classification of goods - Bakery Improvers - whether classified under Chapter heading 2108 of CETA, 1985 by the Revenue or classified under chapter heading 1905 attracting nil rate of duty? - Held that - As fairly admitted by both sides, the issue of classification has travelled up to the Supreme Court and the Hon ble Supreme Court pleased to remand the matter to the adjudicating authority to decide the issue of classification afresh taking into consideration all aspects of the case. In other words, it is an open remand by the Hon ble Apex Court - Since the said matter is yet to be decided, it is prudent to remand the present case also to the learned adjudicating authority to decide all issues afresh, taking note of the principles of law settled in this regard. Appeal allowed by way of remand.

Summary

Issues:
Classification of products under Chapter sub-heading 1905 90 90 of CETA, 1985 vs. 2106 90 99 of CETA, 1985.

Analysis:
The appeal was filed against an Order-in-Appeal passed by the Commissioner of Central Excise, Pune-II, alleging misclassification of bakery products by the appellants. The department contended that the products should be classified under Chapter sub-heading 2106 90 99 of CETA, 1985, while the appellants classified them under Chapter sub-heading 1905 90 90. Show-cause notices were issued raising a demand for duty payment, which was confirmed with penalties. The Commissioner (Appeals) allowed the appeal, leading to the Revenue's appeal. The Revenue argued that a previous show-cause notice invoked the extended period of limitation, and the matter had been remanded by the Tribunal and the Supreme Court for fresh classification determination.

The Revenue submitted that a show-cause notice from 2005 alleged misclassification and short payment of duty, leading to confirmation of the demand. The matter was remanded by the Tribunal and subsequently by the Supreme Court for a fresh decision on classification. Therefore, the Revenue requested the present appeal to be remanded as well for a comprehensive reevaluation by the adjudicating authority.

In contrast, the respondent's advocate argued that the product "Bakery Improvers" should be classified under Chapter subheading 1905 90 90 based on detailed analysis and evidences on record, citing a previous judgment by the Tribunal in a similar case. The advocate urged the Tribunal to consider the precedent set by the mentioned judgment.

After considering both parties' submissions, the Tribunal noted the conflicting classification claims and the ongoing remand process by the Supreme Court for a comprehensive reevaluation of the classification issue. As the matter was pending before the adjudicating authority, the Tribunal decided to remand the present case as well for a fresh determination, emphasizing the need to consider all aspects of the case and settled legal principles. The Tribunal allowed the appeal by remanding it to the Commissioner for further proceedings with all issues left open for reconsideration.