1999 (4) TMI 278 - AT - Central Excise

Summary

Issues:
- Large scale amendments in classification list without notice to the appellants
- Interpretation of Notification 111/87 regarding quantity clearance for processed fabrics received for stentering from other factories

Analysis:

1. Amendments in Classification List:
The case involved the respondents filing a classification list claiming benefits under various Notifications for cotton fabrics processed by them. The Revenue made significant amendments to the classification list without notifying the appellants, changing the goods' description and reference to Notifications. The lower appellate authority acknowledged that the appellants were not given an opportunity to be heard in person by the Assistant Collector regarding these amendments. The Tribunal agreed that such amendments should not have been made without the appellants' notice, emphasizing the importance of natural justice principles. Consequently, the Tribunal set aside the impugned order, directing a de novo decision by the adjudicating officer while ensuring the appellants receive a fair hearing.

2. Interpretation of Notification 111/87:
The lower appellate authority differentiated between cotton fabrics received for stentering from parties availing Notification 111/87 benefits and those not availing it. It held that the quantity clearance for processed fabrics was limited to the appellants' own fabrics under Notification 111/87. However, the Tribunal disagreed with this interpretation. It pointed out that Notification 111/87 did not specify any restriction on the quantity clearance for processed fabrics received for stentering from other factories. The Tribunal found no basis in the notification for such a distinction, emphasizing that the aggregate quantity limit of 50,00,000 sq. mtrs applied irrespective of the fabric's source. Therefore, the Tribunal overturned the lower authority's decision on this issue, ruling in favor of the respondents.

In conclusion, the Tribunal addressed the procedural irregularities in making amendments to the classification list and clarified the interpretation of Notification 111/87 regarding quantity clearance for processed fabrics. The judgment upheld the principles of natural justice and ensured a fair hearing for the appellants while providing a comprehensive analysis of the notification's applicability to fabrics received for stentering from various sources.