1998 (10) TMI 278 - AT - Central Excise

Summary

Issues:
1. Classification of kraft folders and steel interlinking channels under different Tariff Headings.
2. Time bar on the demand of duty for the specified period.

Classification Issue Analysis:
The dispute revolves around the classification of kraft folders and steel interlinking channels supplied together by the appellants. The Revenue classified the product under Tariff Heading 94.03 as parts of a filing cabinet, while the appellants argued that kraft folders fall under Tariff Heading 4818.90 and steel interlinking channels under Tariff Heading 8505.00. The appellants had submitted classification lists specifying the nature of the products and claimed exemptions under relevant notifications. The Central Excise Officers later alleged that selling the folders and channels together constituted a wilful misstatement. The adjudicating authority upheld the classification under Tariff Heading 94.03 and imposed a demand for duty and a penalty. The consultant for the appellants argued that the products were not fitted together and should not be considered parts of a filing cabinet. The Tribunal agreed, stating that there was no evidence of the products being sold together with filing cabinets, thus setting aside the classification under Tariff Heading 94.03 and upholding the original classification approved by the department.

Time Bar Issue Analysis:
Regarding the time bar on the duty demand for the period in question, the Tribunal found that the appellants had made full declarations in the classification lists regarding the sizes of the folders and their intended use in filing cabinets, as well as the purpose of the steel interlinking channels. The Tribunal concluded that there was no wilful misstatement or suppression of facts by the appellants, as the products were correctly declared. Therefore, the allegation of time bar was not sustained. The Tribunal allowed the appeal, setting aside the impugned order, and provided consequential relief to the appellants. The cross objections were also disposed of in light of these findings.

In summary, the Tribunal ruled in favor of the appellants, determining that the products should be classified under the Tariff Headings specified in the original classification lists and dismissing the time bar on the duty demand due to the accurate declarations made by the appellants.