1998 (3) TMI 383 - AT - Central Excise

Summary

Issues involved:
1. Classification of aluminium water tank under tariff sub-heading 8607.00 or 7611.00.
2. Time limitation for demand of duty for the period July 1988 to November 1992.
3. Validity of penalty of Rs. 4 lakhs imposed on the appellants.

Classification Issue:
The main issue in the appeal was the classification of the aluminium water tank under tariff sub-heading 8607.00 as argued by the appellants or under tariff sub-heading 7611.00 as contended by the Revenue. The Tribunal referred to a previous judgment and held that the correct classification for the product is 8607.00, as it is designed for use in railway coaches and becomes a part of the coach itself.

Time Limitation Issue:
Regarding the time limitation for the demand of duty, the appellants argued that the end-use of the product was clearly specified as per Railway specifications, and thus the demand of duty for the period in question was barred by time. The Tribunal agreed with this argument and held that the demand of duty was clearly beyond the period of six months and therefore barred by time.

Penalty Validity Issue:
The question of the validity of the penalty of Rs. 4 lakhs imposed on the appellants was also considered. In light of the classification and time limitation issues being decided in favor of the appellants, the Tribunal concluded that the imposition of the penalty did not arise and subsequently set aside the penalty.

In conclusion, the appeal was allowed on all points raised by the appellants, and the impugned order was set aside.