2015 (10) TMI 41 - AT - Central Excise

Waiver of pre deposit - Classification of goods - Held that - First appellate authority has not decided the case on merits regarding classification of the goods manufactured and exported by the appellant on payment of duty. Department also accepted the payment of duty and also sanctioned rebate claims on the goods which now are proposed to be chargeable to NIL rate of duty. In the interest of justice Order dated 18.12.2009, passed by the first appellate authority is set aside and the case is remanded to the first appellate authority to first decide the issue of classification of impugned goods on merits without insisting for any pre-deposit. - Matter remanded back - Decided in favour of assessee.

Summary

Issues: Stay application and appeal against Order-in-Appeal No.50/Kol-I/09 dated 18.12.2009 regarding classification of goods under Tariff headings.

Analysis:
1. The appellant filed a stay application and appeal against the Order-in-Appeal No.50/Kol-I/09 dated 18.12.2009 passed by the Commissioner (Appeals-I) of Central Excise, Kolkata as the first appellate authority.

2. The appellant argued that they were directed to predeposit 50% of the demand confirmed and penalty imposed, but they informed their inability to comply. The appellant filed a writ petition in Calcutta High Court, which remanded the case to the Tribunal for considering the merits of the case while deciding the stay application.

3. The appellant contended that their products should be classified under Tariff heading 73063090, chargeable to 16% duty, and not under Tariff heading 84369900. They provided a Chartered Engineers Certificate to support their claim.

4. On the other hand, the Revenue argued that the correct classification of the goods was under Tariff Heading 84369900, chargeable to Nil rate of duty, and penalties were correctly imposed.

5. The High Court observed that the Tribunal had the power to modify its orders for the ends of justice, and the first appellate authority had not decided the case on merits regarding the classification of the goods. The case was remanded to the first appellate authority for a fresh decision on the classification issue without insisting on any pre-deposit, ensuring the appellant's opportunity for a personal hearing.

6. Consequently, the appeal filed by the appellant was allowed by way of remand, and the stay application was disposed of. The first appellate authority was directed to decide the issue of classification of the goods on merits without requiring any pre-deposit, ensuring a fair hearing for the appellant.