1994 (10) TMI 168 - AT - Central Excise

Summary

Issues:
1. Classification of plywood as structural or commercial.
2. Applicability of duty rate on plywood described as shuttering plywood.
3. Question of limitation on the demand period.

Analysis:

Issue 1: Classification of plywood as structural or commercial
The case involved a dispute regarding the classification of plywood manufactured by the appellant as either structural or commercial plywood. The Department contended that the plywood declared as shuttering plywood by the appellant was actually structural plywood, attracting a higher duty rate. The appellant argued that the plywood met ISI specifications for commercial plywood and fell under the category of commercial plywood as per relevant notifications. The Tribunal referred to previous decisions and ISI specifications to determine that shuttering plywood and structural plywood were distinct products. The Tribunal agreed with the appellant's contention that the plywood described as shuttering plywood was not structural plywood, thus liable for duty at the rate applicable to commercial plywood.

Issue 2: Applicability of duty rate on plywood described as shuttering plywood
The appellant maintained that the plywood described as shuttering plywood was commercial plywood and should be subject to a duty rate of 20% as per Notification No. 55/79. The Department argued that shuttering plywood was equivalent to structural plywood and should be taxed at a higher rate of 30%. The Tribunal, after analyzing the evidence and previous decisions, concluded that the plywood labeled as shuttering plywood by the appellant was not structural plywood. Therefore, the duty rate applicable was 20% as commercial plywood, in line with Notification No. 55/79.

Issue 3: Question of limitation on the demand period
The appellant raised a limitation defense, arguing that the show cause notice was issued beyond the prescribed period of six months. They contended that without proof of suppression or misstatement, the demand could not extend beyond six months. The Department claimed that the appellant had suppressed the production of shuttering plywood by not submitting classification lists or price lists. The Tribunal found no evidence of suppression or misstatement and held that the demand beyond six months was time-barred. Consequently, the Tribunal allowed the appeal and set aside the impugned order.

In conclusion, the Tribunal ruled in favor of the appellant, determining that the plywood described as shuttering plywood was not structural plywood and should be taxed at the rate applicable to commercial plywood. The limitation defense was upheld, leading to the appeal being allowed and the impugned order being set aside.