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1994 (9) TMI 87 - HC - Central Excise

Issues:
1. Classification of products under Central Excise Rules, 1944.
2. Final approval of classification and alteration of Central Excise Duty rate.
3. Breach of principles of natural justice in passing the final order.
4. Entitlement to opportunity of hearing before finalization of provisional approval.
5. Alternative remedy of appeal under Sec. 35 of the Central Excises & Salt Act, 1944.

Detailed Analysis:
1. The petitioner filed classification lists for their products under Chapter sub-heading No. 3003.30, seeking Nil rate of duty. The provisional approval was granted for the classification. Later, the Assistant Collector finalized the classification and altered the duty rate, leading to demand notices for a significant amount of duty.
2. The impugned order dated 27-4-1991 and subsequent notices were challenged on the grounds of breach of natural justice. The petitioner argued that no show cause notice or hearing was provided before modifying the classification to their detriment. The respondent countered that the finalization was done after considering all relevant factors and Chemical Examiner's Test Reports.
3. The respondent contended that the petitioner was not entitled to a hearing before finalization, citing provisions in the Central Excises & Salt Act, 1944. They highlighted that the Collector (Appeals) had the authority to modify or annul the decision, making the appeal process an effective remedy.
4. The court acknowledged the statutory remedy of appeal under Sec. 35 of the Act, emphasizing the Collector (Appeals)' wide powers to review and modify orders. Consequently, the court directed the petitioner to file an appeal within six weeks, ensuring a fair hearing and opportunity to present evidence.
5. The judgment disposed of the petition, instructing the Collector (Appeals) to decide on the appeal within three months. The interim order dated 20-7-1991 would remain in effect until the appeal's resolution, with the petitioner exempt from depositing any amount under Section 35F of the Act.

 

 

 

 

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