1997 (10) TMI 126 - AT - Central Excise

Summary

Issues:
- Duty demand and penalty imposed by the Additional Collector of Central Excise
- Classification of medicaments under Central Excise Tariff Item 3301
- Time limit aspect in relation to duty demand
- Allegations of suppression by the Department

Analysis:
The appeal in this case was against the Order-in-Original passed by the Additional Collector of Central Excise, confirming a duty demand of Rs. 73,213/- and imposing a penalty of Rs. 10,000/- on M/s. Kosan Industries P. Ltd. The adjudicating authority based its decision on the classification of certain medicaments under Central Excise Tariff Item 3301, attracting a duty of 20% ad valorem.

Regarding the time limit aspect, the appellant argued that the clearances of the goods in question occurred between 1-4-1987 to 31-3-1990, while the show cause notice was issued on 30-5-1991. They claimed that they had filed a classification list for the goods under sub-heading 3005.90, but the Assistant Collector amended it to 3003.30 with a nil rate of duty. The appellant contended that they followed the Department's direction and cleared the goods without payment of duty, thus denying any suppression on their part.

On the other hand, the Department argued that the appellants did not disclose all relevant facts in the classification list, specifically regarding the bulk packaging of Cineole and Eucalyptus Oil. The Department claimed that the wrong classification was due to the lack of proper description in the list, amounting to suppression as per the impugned order.

Upon reviewing the submissions, the Tribunal found that the appellants had filed a classification list with the correct descriptions and tariff headings. The Assistant Collector consciously amended the classification to nil rate of duty based on Rule 173B, indicating no short levy due to accepted classification. The Tribunal also noted that the appellants had filed a price list mentioning the exemption of excise duty, including the packing details of the goods.

The Tribunal agreed with the appellant's argument that there was no suppression of facts on their part, as evidenced by the documents submitted. They held that the demand for duty and penalty was beyond the six-month limitation period and set aside the order, allowing the appeal. The Tribunal concluded that the facts did not justify the invocation of a longer limitation period, ultimately ruling in favor of the appellant.