1998 (2) TMI 295 - AT - Central Excise

Summary

Issues:
1. Entitlement for the benefit of Notification No. 65/87
2. Entitlement for the benefit of time bar

Entitlement for the benefit of Notification No. 65/87:
The appeal was filed against the Commissioner's orders stating that the appellants, manufacturing tubular fabrics on circular looms, were not manufacturing sacks. The Commissioner held that sewing sacks from cut fabric pieces without power did not qualify as manufacturing sacks with power. The JDR argued that manufacturing tubular fabric on circular looms with power and then stitching the fabric into sacks constitutes manufacturing with power. Referring to a previous Tribunal decision, the JDR emphasized that sacks are made from tubular fabrics on circular looms, disqualifying the appellant from Notification 223/86 benefits. The Advocate contended that tubular fabrics are not linked to sack manufacturing. The Tribunal agreed with the JDR's interpretation, holding the appellant ineligible for Notification 65/87 benefits.

Entitlement for the benefit of time bar:
Regarding the time bar, the Collector agreed with the noticee that a previous demand in 1988 on a similar issue precluded suppression or misdeclaration claims. The JDR alleged that the appellants concealed the fact that HDPE woven sacks were made without power, misleading the department. However, the Advocate referenced Trade Notice No. 1/89, indicating that the tubular HDPE woven fabrics were correctly classified under Heading 54.08. The Tribunal found that the appellant's claim of manufacturing sacks without power contradicted the use of power in making tubular fabrics, constituting suppression. Citing a Supreme Court decision, the Advocate argued that approved classification lists negate wilful suppression, but the Tribunal held that the deliberate concealment of manufacturing tubular fabrics with power amounted to wilful suppression, justifying a longer period for invoking the time bar. Consequently, the Tribunal set aside the impugned order and allowed the departmental appeal.