1996 (9) TMI 300 - AT - Central Excise

Summary

Issues: Classification of goods under Tariff Item 52, Time limitation for raising demand post-Tribunal order

Classification of Goods under Tariff Item 52:
The appellants argued for the classification of bolts, nuts, and screws under Tariff Item 68 due to their fastening functions being incidental. However, the Assistant Collector classified them under Tariff Item 52. Despite success before the Collector (Appeals), the Tribunal upheld the classification under Tariff Item 52. The appellants did not contest the classification based on a Supreme Court decision. The issue arose regarding the time bar for demanding duty post-Tribunal order without a show cause notice, as per the decision in Plasmac Machine Mfg. Co. Ltd. v. Collector of Central Excise. The appellants emphasized the necessity of a show cause notice post-Tribunal order to maintain the demand.

Time Limitation for Raising Demand Post-Tribunal Order:
The Department justified the classification under Item 52 and argued that the demand raised post-Tribunal order was not time-barred. The Department contended that since the matter was pending before the Tribunal and the demand was raised only after the Tribunal's order, the limitation did not apply. However, the Tribunal found that the D.D. 2 form issued after the Tribunal's order did not suffice as a show cause notice. Citing judicial pronouncements, the Tribunal concluded that the demand, based on the D.D. 2 form without a subsequent show cause notice, contravened statutory requirements. The Tribunal held that the demand was time-barred due to the absence of a proper show cause notice post-Tribunal order, thereby setting aside the impugned order and allowing the appeal with consequential relief.