1993 (8) TMI 167 - AT - Central Excise

Summary

Issues: Classification of raw carbon dioxide gas under Tariff Item 14H or Tariff Item 68, enforceability of demand for the six months prior to the show cause notice.

Classification Issue:
The appellants produced carbon dioxide gas during the alcohol manufacturing process, classified under Tariff Item 68 when cleared for home consumption. A show cause notice was issued to classify it under Tariff Item 14H, demanding duty payment for clearances made. The department argued that I.S.I. specification is for quality control and not conclusive for classification. The appellants marketed the gas as carbon dioxide, supporting the department's view that it is known in trade as such. The duty is not limited to technically pure carbon dioxide, as confirmed in the Order-in-Original.

Enforceability of Demand Issue:
Regarding the demand enforceability for the period before the show cause notice, the department contended that reclassification can be prospective, citing a Tribunal decision in a previous case. However, the present case differs as a Show Cause Notice was issued, allowing duty short-levied for the past period to be demanded. Section 11A of the Central Excises and Salt Act provides the power to review classification for earlier periods and demand duty short-levied within six months or five years. The Supreme Court's decision in Padmini Products limited demands to the past six months before the Show Cause Notice, which applies in this case due to a Tariff Advice in favor of the original classification claimed by the assessee.

Conclusion:
The Tribunal rejected the appeal, stating that the demand for the six months prior to the Show Cause Notice is enforceable. The request for a refund to the buyer of the assessee was deemed unnecessary. The decision was based on the classification of raw carbon dioxide gas as falling under Tariff Item 14H and the limited enforceability of the demand period as per relevant legal provisions and precedents.