1987 (9) TMI 203 - AT - Central Excise

Summary

Issues:
Interpretation of Notification No. 55/75 for exemption of duty on vinegar claimed as a food product.
Time bar defense for one of the demands raised by the Department.

Interpretation of Notification No. 55/75:
The appeal revolved around the classification of vinegar as a food product under Notification No. 55/75 for duty exemption. The Appellants argued that vinegar, being an additive to food used for taste and preparation, should be considered a food product under the broad description of "all kinds of food products" in the notification. They cited various judgments to support their interpretation of the term "food product." However, the Tribunal noted that the judgments referred to were not directly related to the entry under Notification No. 55/75 but were based on Sales Tax Act entries. The Tribunal emphasized that the term "food product" needed to be understood within the context of the notification itself. The Tribunal, relying on a judgment by the Allahabad High Court, concluded that vinegar did not qualify as a food product under the notification. The Tribunal differentiated between food, food products, and food preparations, stating that vinegar did not fall under any of these categories. Consequently, the Tribunal held that vinegar was not covered by the notification.

Time Bar Defense:
Regarding the time bar defense raised by the Department for one of the demands, the Appellants argued that the demand was beyond the limitation period and no allegation of suppression or misstatement had been made. The Department, citing a judgment by the Allahabad High Court, contended that the demand was not time-barred. The Tribunal observed that the demand covered by the show cause notice was indeed beyond the time limit, and no basis existed for invoking a longer time limit. As a result, the Tribunal deemed the demand beyond the time limit as not maintainable in law. However, for the other demand, which was correctly raised and confirmed, the Tribunal partially allowed the appeal with consequential relief.

In conclusion, the Appellate Tribunal CEGAT, New Delhi, in the cited judgment, interpreted the scope of Notification No. 55/75 concerning the classification of vinegar as a food product for duty exemption. The Tribunal ruled that vinegar did not qualify as a food product under the notification. Additionally, the Tribunal addressed the time bar defense raised by the Department, determining one demand as beyond the limitation period and not maintainable, while partially allowing the appeal for the other demand.