2004 (12) TMI 153 - AT - Central Excise

Summary

Issues: Classification of "LAL TAIL", Penalty Imposition, Correct Computation of Duty Amount

Classification of "LAL TAIL:
The appeal focused on the classification of "LAL TAIL," with the Tribunal's previous order supporting the Revenue's stance. The application for rectification highlighted the omission of penalties and the correct duty computation in the original order. The Revenue's appeal did not address penalty or duty computation issues. The Tribunal clarified that its original order solely addressed the classification matter and did not automatically reinstate the penalties or duty amounts from the original order-in-original. The Tribunal concluded that separate consideration was necessary for penalty and duty amount issues.

Penalty Imposition:
The Tribunal noted that the dispute was purely legal, as the duty demand was raised during the normal period due to a classification disagreement. It was established that no contumacious conduct was involved, and when duty demand arises from a short levy during the normal period, penalty imposition is not applicable. Therefore, the Tribunal set aside the penalty imposed in the original order-in-original.

Correct Computation of Duty Amount:
Regarding the duty amount, the Tribunal found that the computation method used in the original order-in-original contradicted established law. Citing a previous Supreme Court ruling, the Tribunal determined that duty should be calculated based on the cum-duty price. The Tribunal ordered the duty amount to be recalculated on a cum-duty basis, aligning with the legal precedent. Consequently, the Tribunal allowed the rectification of mistake application, addressing the penalty and duty amount issues as outlined in the judgment.