1990 (1) TMI 262 - AT - Central Excise

Summary

Issues:
1. Classification of PVC 'Master Batches' under Tariff Items.
2. Claim for refund of duty paid under Tariff Item 14.I(i)(ii).
3. Dispute over adjustment and refund of duty under Tariff Item 68.
4. Interpretation of Tribunal's order regarding classification and refund.

Analysis:
1. The appellant manufactured PVC 'Master Batches' and initially classified them under T.I. 14.I(i)(ii) of the CET. Following a tariff amendment, the appellant sought reclassification under a different item for full exemption. The Assistant Collector and the Collector (Appeals) upheld the original classification. The Tribunal, however, classified the product under the residuary Tariff Item 68, contrary to both parties' claims.

2. The appellant paid duty under protest during a specific period when the classification dispute was ongoing. Despite the Tribunal's decision, the appellant continued to pay duty under the original classification. The appellant now seeks a refund of the duty paid under the original classification, arguing that no show cause notice was issued for the new classification under Tariff Item 68.

3. The Revenue contends that the duty paid under the original classification should be adjusted against the duty leviable under Tariff Item 68, as directed by the Tribunal. The Revenue asserts that the entire amount paid by the appellant has been adjusted, leaving no refundable amount.

4. The appellant argues that the Revenue cannot adjust the duty paid without issuing a show cause-cum-demand notice for the new classification under Tariff Item 68. Citing precedent, the appellant asserts that if a prior levy is deemed illegal, the department must refund the amount without considering alternative tariff items. However, the Tribunal finds this argument unpersuasive, stating that the doctrine of merger applies, and the Tribunal's decision supersedes lower authorities' decisions. Additionally, the Tribunal emphasizes its directive for approval of the appellant's classification list with necessary adjustments.

5. Ultimately, the Tribunal dismisses the appellant's application, ruling that there are no merits in the claim for refund. The Tribunal asserts that it cannot review its own decision and upholds the Revenue's position regarding the adjustment of duty paid by the appellant under the original classification.