1988 (6) TMI 207 - AT - Central Excise

Issues:
Levy of duty under Tariff Item 68 on goods manufactured by the respondents, eligibility for exemption under Notification No. 176/77, dated 18-6-1977, classification of printed cartons and despatched machine plates, time-barred demand for duty, suppression of facts by the respondents.

Analysis:

1. Levy of Duty under Tariff Item 68:
The appeal before the Appellate Tribunal concerned the Collector of Central Excise, Calcutta challenging the order of the Collector of Central Excise (Appeals) Calcutta regarding the levy of duty under Tariff Item 68 on goods like Printed cartons, Writing pad covers, etc. manufactured by the respondents. The duty amount involved was Rs. 4451.80. The respondents manufactured goods under Tariff Item 68 both on their account and on a job work basis.

2. Eligibility for Exemption under Notification No. 176/77:
The issue revolved around the eligibility of the respondents for exemption under Notification No. 176/77, dated 18-6-1977. The conditions for exemption required that the total investment in plant and machinery should not exceed 10 lakhs and the value of clearance of all excisable goods in the preceding financial year should not exceed Rs. 30 lakhs. The Original authority found that the total investment in plant and machinery exceeded the limit, making the factory ineligible for the concession granted under the notification.

3. Classification of Printed Cartons and Machine Plates:
The respondents contended that the printed cartons and despatched machine plates were products of the printing industry and hence exempt from duty. However, the authorities found that printed cartons were products of the packaging industry and not printing industry, thus not entitled to any concession under Notification No. 55/75, dated 1-3-1975. Similarly, despatched machine plates were not considered products of the printing industry and were also not entitled to the concession.

4. Time-Barred Demand and Suppression of Facts:
The Collector (Appeals) noted that while the duty demand was for a specific period, the show cause notice was issued after a significant delay. The issue of time-barring the demand was raised. The Departmental Representative argued that the respondents had not included the cartons in their price list, indicating suppression of facts. However, the Tribunal found that the non-payment of duty on cartons was due to a misunderstanding of the legal position at the time and not mala fide intention.

5. Judicial Precedents and Conclusion:
The Tribunal referred to previous decisions by the Government of India and held that the appellants could not be held guilty of suppressing facts or evading duty. The Tribunal dismissed the appeal, stating that the demand was time-barred and the respondents were not liable for any wrongdoing in the non-payment of duty on the cartons. The confusion regarding the value of plant and machinery employed for the manufacture of specific goods was also noted, leading to the dismissal of the appeal.

This detailed analysis covers the key issues involved in the legal judgment, including the eligibility for exemption, classification of goods, time-barring of demands, and the absence of suppression of facts by the respondents.

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