2000 (5) TMI 718 - AT - Central Excise

Summary

Issues: Limitation period for demand raised; Classification of end cuttings and steel side cuttings.

Issue 1: Limitation period for demand raised
The judgment revolves around the issue of the limitation period for the demand raised by the adjudicating authority. The duty amount and penalty imposed were contested by the appellant on the grounds of limitation. The period involved in the appeal was from April 1988 to February 1992, and the show cause notice was issued in November 1992, beyond the six-month limitation period. The appellant argued that the classification lists filed over the years were approved by the proper officer under heading 72.04, and orders passed by the Asstt. Commissioner in their case supported their belief that the end cuttings and side cuttings were classifiable as waste and scrap. The Tribunal, after considering the arguments, held that the demand raised in November 1992 for the mentioned period was indeed barred by the limitation of six months. The appeal was allowed on this ground, providing relief to the appellants.

Issue 2: Classification of end cuttings and steel side cuttings
The classification of end cuttings and steel side cuttings was another crucial issue in the judgment. The adjudicating authority had confirmed a duty amount and imposed a penalty by classifying these cuttings under heading 7208.90 instead of 7204.90 as claimed by the appellant. The appellant argued that previous classification lists were approved under heading 72.04 and pointed to an order by the Asstt. Collector in a similar case supporting their classification. On the other hand, the respondent contended that the appellants did not provide a complete description of the product in the classification lists and failed to declare the further use of the cuttings in manufacturing other items. Ultimately, the Tribunal did not express a specific opinion on the classification of the product but found in favor of the appellant on the limitation issue. The Tribunal highlighted that the appellants had sufficient reason to believe in their classification based on the approval of previous lists and orders from the Asstt. Commissioner.