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Home Case Index All Cases Central Excise Central Excise + AT Central Excise - 1996 (9) TMI AT This

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1996 (9) TMI 301 - AT - Central Excise

Issues:
Classification of skimmed milk powder under Tariff Item 1B, applicability of exemption Notification No. 145/73, whether the product was packed in unit containers ordinarily intended for sale, and the issue of limitation regarding the duty demand.

Analysis:
1. The appeal challenged the order-in-appeal holding the appellants liable for Central Excise duty on skimmed milk powder packed in polythene bags. The Collector found the goods fell under Tariff Item 1B and did not meet the conditions for exemption under Notification No. 145/73 for regeneration of liquid milk within the factory premises or elsewhere.

2. The appellants contested the predetermined quantity for packing, stating the milk powder was for regeneration within the factory and their Madras Unit. They argued the failure to follow Chapter X Procedure for removal was a minor breach and sought exemption or limitation due to no suppression of facts.

3. The appellants submitted written responses, while the respondent was represented by a Departmental Representative supporting the Collector's order.

4. The case history involved multiple adjudication orders and appeals, culminating in the impugned order holding the skimmed milk powder under Tariff Item 1B. The Tribunal remanded the matter for classification under the Tariff, leading to the final order-in-appeal.

5. The Tribunal analyzed the expression "unit containers" in Tariff Item 1B based on precedents, emphasizing containers designed for selling predetermined quantities. Relevant judgments and instructions were cited to determine the classification criteria.

6. The Tribunal concluded that the skimmed milk powder did not fall under Tariff Item 1B due to the packing method, rejecting the Collector's classification and denial of exemption under Notification No. 17/70-C.E. The judgment of the Andhra Pradesh High Court was cited to support the non-leviability of excise duty in specific circumstances.

7. Following the Andhra Pradesh High Court judgment, the product was deemed non-excisable until a specific date, after which it fell under a different Tariff item with exemption. The Tribunal ruled in favor of the appellants, stating no duty was payable under Tariff Item 1B or the alternative classification.

8. Ultimately, the appeal was allowed, setting aside the duty demand and confirming the appellants' position on the classification and exemption issues.

 

 

 

 

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