1992 (2) TMI 203 - AT - Central Excise

Summary

Issues:
Classification of glass containers under Central Excise Tariff, Misdeclaration of goods, Penalty imposition, Confiscation of goods, Recovery of duty, Application for additional evidence, Applicability of Rule 9(2), Relevant case laws cited.

Classification of Glass Containers:
The appeal concerns the classification of glass containers manufactured by the appellants as parts of storage batteries under Item 31(3) of the Central Excise Tariff. The Collector had classified the containers under Item 31(3) instead of the appellants' classification as laboratory glassware under Item 23A(2). The appellants argued that the containers were suitable for Caustic Soda Wet Cells and not storage batteries, citing ISI standards and trade notices. The Tribunal agreed with the Collector (Appeals) that the containers should be classified under Item 23A(4) as "other glass and glassware" based on their usage and specifications.

Misdeclaration and Penalty Imposition:
The appellants were accused of misdeclaration for seeking classification under Item 23A(2) and faced penalty and confiscation of goods. The Tribunal noted that authorities had previously approved the classification in 1980 and that the show cause notice issued in 1982 was still pending adjudication. As there was no evidence of misstatement or suppression of facts, the charge of misdeclaration was not established. Consequently, the orders of confiscation and penalty were set aside, and the authorities were directed to recover any short levy for a period of six months prior to the show cause notice date.

Recovery of Duty and Rule 9(2) Applicability:
The appellants contended that Rule 9(2) did not apply as there was no clandestine removal of goods. The Tribunal referenced relevant case laws to support the argument that duty recoveries in cases of reclassification should be limited to a period of six months preceding the order. The Tribunal held that Rule 9(2) was not applicable in this scenario.

Application for Additional Evidence and Relevant Case Laws:
The appellants submitted an application for additional evidence, including an order from the Collector of Central Excise (Appeals) in their favor. The Tribunal allowed the application, considering the relevance of the additional evidence. Both parties cited various case laws to support their arguments regarding classification, misdeclaration, and applicability of rules.

Conclusion:
The Tribunal upheld the classification of glass containers under Item 23A(4) as "other glass and glassware." The charge of misdeclaration was not established, leading to the setting aside of penalty and confiscation orders. The authorities were directed to recover duty for only six months preceding the show cause notice date. The Assistant Collector was instructed to recalculate the duty demand, provide a basis for calculation, and allow the appellants to present further information for expeditious completion of proceedings.