2017 (3) TMI 846 - AT - Central Excise

Benefit of N/N. 6/2006-CE - classification of goods - atraumatic needled sutures - Held that - an identical issue has come up before the Tribunal in the case of Sutures India Pvt. Ltd. Vs. CCE Bangalore 2009 (1) TMI 630 - CESTAT, BANGALORE where the same issue was involved, where it was held that the law is clearly settled as to the claiming of classification of the goods and claiming exemption under particular notification is a matter of belief and would not amount to mis-declaration - demand set aside - appeal allowed - decided in favor of appellant.

Summary

Issues:
- Entitlement to central excise duty exemption under notification no. 6/2006-CE for atraumatic needled sutures
- Invocation of extended period for demand of duty
- Imposition of penalties, interest, and confiscation of seized goods

Entitlement to central excise duty exemption under notification no. 6/2006-CE for atraumatic needled sutures:
The appellant, a company engaged in manufacturing sutures, faced scrutiny regarding their entitlement to the duty exemption under notification no. 6/2006-CE for atraumatic needled sutures. The Department launched an investigation and obtained reports from Surgeons/Hospitals regarding the utilization of the appellant's sutures in cardiac and ophthalmic surgeries. While reports confirmed significant usage in these surgeries, there was ambiguity about the utilization in other surgeries. Despite previous confirmation of utilization in ophthalmic and cardiac surgeries, a demand-SCN was issued demanding duty payment on atraumatic and non-atraumatic sutures based on filed returns. The appellant challenged the demand-SCN, extended period invocation, and proposed penalties and confiscation.

Invocation of extended period for demand of duty:
The Central Excise Department did not accept the appellant's defense and confirmed the demand using the extended period. Additionally, penalties, interest, and confiscation of seized goods were ordered. The appellant, aggrieved by this decision, filed the present appeal challenging the imposition of duties and penalties.

Imposition of penalties, interest, and confiscation of seized goods:
The CCE confirmed the demand, penalties, interest, and confiscation of goods, leading to the appellant filing the present appeal. During the hearing, it was noted that a similar issue had been addressed by the Tribunal in a previous case involving Sutures India Pvt. Ltd. vs. CCE Bangalore. The Tribunal referred to a Supreme Court judgment where the Department's appeal was dismissed, establishing a legal precedent. Based on this settled legal position, the impugned order was set aside, and the appeal was allowed with consequential relief.

This judgment highlights the importance of establishing entitlement to duty exemptions, the implications of invoking extended periods for duty demands, and the legal precedents that influence appellate decisions in matters of central excise duty disputes.