2000 (1) TMI 424 - AT - Central Excise

Summary

Issues:
Classification of aluminium paint in dual pack, enforceability of demands raised in show cause notices.

Classification Issue:
The judgment concerns the classification of aluminium paint in a dual pack. The appellants argued for classification under 3212.90 as "pigments dispersed in non-aqueous media," while the authorities classified it under Heading 3209.90 as a paint. The product in question is a dual pack consisting of aluminium paste and varnish, mixed to obtain aluminium paint. The Tribunal referred to Note 2 to Section VI, stating that goods intended to be mixed together to obtain a product should be classified under the heading appropriate to that product. As the mixed paste and varnish result in aluminium paint, the correct classification is under CET Sub-heading 3208.90, rejecting the appellants' claim that the mixed product is pigment under Heading 32.12.

Enforceability of Demands Issue:
Regarding the demands raised in show cause notices, the Tribunal found that demands for the period covered by the first three notices could not be sustained since the product was cleared in accordance with approved classification lists during that time. Citing a Supreme Court decision, demands for the period from March to August 1992, covered by the last two notices, were deemed sustainable as the classification lists for these periods were not finally approved. The Tribunal confirmed duty demands for the last two notices. The appellants' plea for reassessment of duty payable based on the provisions of Section 4 of the CESA, 1944 was accepted, and the issue was remanded for redetermination of duty. The plea against classification under Heading 32.08 was not allowed due to lack of material for verification, but the appellants were granted liberty to raise this issue in subsequent proceedings.

In conclusion, the appeal was partly allowed, upholding the classification under CET Sub-heading 3208.90 for the aluminium paint in the dual pack and confirming duty demands for the period from March to August 1992. The issue of reassessment of duty was remanded, and the appellants were granted liberty to challenge the classification in future proceedings.