2001 (1) TMI 187 - AT - Central Excise

Summary

Issues involved:
Classification of lead sheets fitted with headers, clandestine removal of goods, evasion of duty.

Classification Issue Analysis:
The appeal was filed by the Revenue against the order-in-original, which dropped proceedings initiated based on a show cause notice. The respondents were engaged in manufacturing unwrought zinc ingots but were found to have cleared lead anodes without duty payment in a clandestine manner. The Collector accepted the respondents' version that lead sheets fitted with headers were classifiable under sub-heading 7801 of the CETA, not 8543. The Tribunal upheld this decision, citing a precedent where attaching headers to sheets did not constitute manufacturing a new product. The Revenue's attempt to change the classification during the appeal was rejected, following the principle that a new case cannot be made at the appeal stage.

Clandestine Removal Issue Analysis:
Regarding the clandestine removal of goods, the Collector found no discrepancy in the raw material registers and accepted the explanation that the non-accountal of zinc ingots in the RG 1 Register was due to procedural delays, not deliberate evasion. The Tribunal concurred with this finding, emphasizing that mere non-accountal without evidence of intent to evade duty does not warrant invoking relevant provisions. Citing a precedent, the Tribunal held that the absence of evidence showing deliberate evasion supported the Collector's decision to absolve the respondents from liability under the rules.

Conclusion:
The Tribunal upheld the Collector's order, ruling in favor of the respondents on both classification and clandestine removal issues. The appeal by the Revenue was dismissed for lacking merit, with the judgment finding no infirmity in the Collector's decision.