1999 (2) TMI 193 - AT - Central Excise

Summary

Issues:
1. Application for waiver of deposit of duty and penalty under Section 11A.
2. Confusion regarding liability to duty on concrete mix.
3. Distinction between ready mix concrete and concrete mix.
4. Limitation period for duty demand.
5. Prospective demand from the date of citing a Supreme Court judgment.

Analysis:

Issue 1: The application sought a waiver of deposit of Rs. 19.13 lakhs and penalty under Section 11A. The applicant, a builder, manufactured concrete mix at the site for use in its buildings. Duty was demanded on the concrete mix, leading to confusion regarding the liability to duty.

Issue 2: The confusion stemmed from the Board Circular clarifying that ready mix concrete is chargeable to excise duty and classifiable under Heading 38.23. However, the circular was kept in abeyance, creating uncertainty about the duty liability on concrete mix manufactured at the site.

Issue 3: The Departmental Representative emphasized the distinction between ready mix concrete and concrete mix based on Indian Standard specifications. However, the Tribunal found it difficult to perceive a clear distinction between the two products, indicating that the confusion was reasonable.

Issue 4: Considering the lack of clarity in the distinction between ready mix concrete and concrete mix, the Tribunal observed that the applicant could have genuinely believed that the product manufactured was not liable to duty. The Tribunal also noted the support from a High Court order, further strengthening the applicant's case.

Issue 5: The Tribunal, in light of the confusion and lack of clarity surrounding the duty liability on concrete mix, directed the applicant to deposit Rs. 2 lakhs within a month and waived the deposit of the remaining duty and penalty amounts. This decision aimed to address the genuine confusion and uncertainty faced by the applicant.

In conclusion, the judgment highlighted the importance of clarity in tax liabilities and the need for consistency in regulatory guidelines to avoid confusion and disputes. The Tribunal's decision to waive the deposit reflected a fair and pragmatic approach to address the genuine belief and confusion faced by the applicant in this case.