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1997 (12) TMI 123 - SC - Central Excise
Issues involved: Classification of goods for duty, applicability of Notification No. 89/79, time bar on show cause notice, influence on invoice value, justification of penalty.
Classification of goods for duty: The Tribunal considered whether the goods should attract duty under Item 25 or if machining would change the classification to T.I. 68. The department appealed against the Tribunal's decision on this issue. Applicability of Notification No. 89/79: The department argued that goods cleared from different factories should be clubbed together for tax purposes. However, the Tribunal found that the exemption notification exempts goods valued up to Rs. 30 lakhs under T.I. 68 from taxation, and since the goods from one factory were taxed under T.I. 25, they should not be added to the value of goods cleared under T.I. 68 from another factory. Time bar on show cause notice: The Tribunal determined whether the show cause notice dated 8-1-1982 was barred by time. It was found that the department was aware of the nature of products manufactured, and there was no suppression of fact by the respondent, as clarified in the correspondence between the respondent and the Superintendent. Influence on invoice value: The Tribunal examined if the invoice value had been influenced by other considerations. No specific details were provided in the summary regarding the Tribunal's findings or the department's arguments on this issue. Justification of penalty: The Tribunal assessed whether the penalty imposed was justified. No specific details were provided in the summary regarding the Tribunal's findings or the department's arguments on this issue. The Supreme Court upheld the Tribunal's decision on the issues of time bar on the show cause notice and the applicability of Notification No. 89/79, dismissing the department's appeal. The Court agreed that there was no suppression of fact by the respondent and that the goods should be classified separately for tax purposes based on the clear language of the exemption notification. The appeal was dismissed with no order as to costs.
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