2012 (6) TMI 528 - AT - Central Excise

Notification No. 24/2009-CE u/s 11C - manufacture of printed cartons and catch covers - duty demand on printed catch covers bearing brand name/trade name of another person - invoking extended period of limitation - Held that - Section 11C notification was issued in respect of similar products for the period from 1.10.1987 to 31.8.2008 clearly indicates that there was a general trade practice wherein exemption was availed in respect of packing materials bearing brand name of another person under the Small Scale Notifications. Therefore in the case of printed catch covers also the same belief could have been entertained bona fide - the extended period of time could not have been invoked in the instant case for confirming the duty demand - pre-deposit of Rupees Nine thousand only within stipulated time for the normal period of limitation.

Summary

Issues:
- Appeal against Order-in-Appeal No. YBD/48/M-I/2011 dated 15.7.2011 passed by the Commissioner of Central Excise (Appeals), Mumbai Zone I.
- Stay application consideration.
- Interpretation of Notification No. 8/2003-CE and subsequent amendments regarding exemption for specified goods.
- Classification of printed catch covers under the same heading as printed cartons for exemption eligibility.
- Time-barred Show Cause Notice for duty demand.

Analysis:
1. The appellants, engaged in manufacturing printed cartons and catch covers, availed Small Scale Exemption under Notification No. 8/2003-CE. A Show Cause Notice was issued for denying exemption due to brand names on goods. The adjudicating authority confirmed duty demand on printed catch covers bearing brand names for a specific period and imposed penalties. The lower appellate authority upheld this decision, leading to the current appeal.

2. The appellants argued that printed catch covers should be granted the same exemption as printed cartons under Section 11C notification. They contended the Show Cause Notice was time-barred, issued in 2009 for the period 2004-2008, with a minimal demand for the normal period.

3. The Tribunal analyzed Notification No. 24/2009-CE (NT) and Section 11C exemption for specified packing materials, excluding printed catch covers. However, considering the general trade practice and bona fide belief in availing exemptions for goods with brand names, the Tribunal held that the extended time period could not be invoked for confirming the duty demand. The Tribunal directed a pre-deposit of Rs 9000 within four weeks, waiving the balance of dues pending appeal.

4. The judgment highlighted the importance of assessing whether printed catch covers fall under the same category as printed cartons for exemption eligibility. It also emphasized the need to consider the time limitation for issuing Show Cause Notices and the impact of general trade practices on interpreting exemption notifications.

5. The decision provided clarity on the application of Section 11C exemption, the significance of bona fide beliefs in availing exemptions, and the procedural requirements for duty demands based on brand names on goods. The Tribunal's ruling aimed to balance the interests of the appellants with the legal framework governing excise duty exemptions.