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TMI Blog1988 (11) TMI 224X X X X Extracts X X X X X X X X Extracts X X X X ..... r short); or under the residuary Item 68. (ii) If the goods fall under Item 16A, whether the assessee is entitled to exemption under Ntfn. 71/78 by virtue of the fact that the clearances of the said product under Item 16A did not exceed Rs. 5 lakhs and the clearances of all excisable goods not exempted were less than Rs. 20 lakhs but including the clearances of exempted excisable goods, the value of clearances exceeded Rs. 20 lakhs. In other words, the question for determination is whether the clearances of exempted goods is to be taken into account to compute the value limit of Rs.20 lakhs for clearances of all excisable goods; (iii) Whether the demand of Rs. 1,58,484.25 for the period 1-4-1979 to 4-6-1980 is hit by limitation of six months specified in Central Excise Rule 10 (as it existed at the material time) inasmuch as the show cause notice was served on the appellants on 11-9-1980. 3. On the first issue, the Collector held that the T.R. Beltings correctly fell for classification under Item 16A (4) CET. On the second issue, the Collector said that he. had already found against the assessee in his Order-in-Appeal dated 21-3-1981. On the last. issue, the Co ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n the product is the predominant material or not. This can be tested by sending a sample to the chemical examiner for analysis. Since the question of availment of notification 80/80 is dependent upon the classification of the product, no views are expressed on it." The Asstt. Collector (not the Asstt. Collector who passed the order dated 30-4-1981) in due course, passed an order dated 11-7-1983 in the remand proceedings. In. this order, the Assistant Collector noted that the concerned Superintendent was directed to draw a sample of the goods and get it tested by the chemical examiner but the Superintendent had reported that there was no stock of T.R. Belting with the assessee nor did it intend to manufacture T.R. Belting in the near future, so no sample could be drawn. However, on a sample drawn on 19-12-1975 which was sent to the Chemical Examiner, he had reported that: "The sample is a piece of green coloured belting containing more than 25% by weight of rubber compound. The rubber contents present in the sample is (sic) vulcanised." It is seen from the order that the assessee produced a sample from the products manufactured by them earlier but it does not say what was done wi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tions set out in the order, the Collector (Appeals) confirmed the classification of the goods under Item 16A CET. It is seen from the order that during the course of hearing, the Counsel for the assessee had stated that an old sample was available which could be sent for testing. 7. During the hearing before us, Shri V.K. Agarwal, Counsel for the assessee strongly urged that the Assistant Collector had, in the remand proceedings, acted outside the parameters set by the order of remand in that he did not send a sample for test and, on the other hand, had held that the test of predominance was irrelevant though the Collector (Appeals) had held that this test was relevant. The Collector (Appeals) also fell in error in changing his view on the point of the predominance test and going back on his earlier view. He was also in error in upholding the Asstt. Collector's order which was contrary to the remand order. In his reply, Shri L.C. Chakraborty, Departmental Representative, for the respondent-Collector, stated, in response to a query from the Bench as to whether the Department could have filed an appeal against the order of remand by the Collector (Appeals), that since the remand ord ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... als) order dated 21-3-1983 was certainly an order passed by him under Section 35A of the Central Excises & Salt Act and if the Revenue was aggrieved by that order, it was open to it to have filed an appeal against the order to the Tribunal in terms of sub-section (2) of Section 35B of the Act. No such appeal having been filed by the Collector, and no appeal having been filed also by the assessee, that order became final as between the Revenue and the assessee. 9. The question arises whether it was open to the Asstt. Collector to act in the matter beyond the parameters set by the Collector (Appeals) in his remand order and further whether the Collector (Appeals) was correct in holding, in the impugned order, that his earlier views on the test of predominance were not relevant and, on that basis, upholding the Asstt. Collector's order. In this context, there are a few authorities which are relevant. One is Bhopal Sugar Industries Ltd. v. Income-tax Officer, Bhopal (1960) 40 ITR 618. In this case, the facts were that the Appellate Tribunal had directed the Income-tax Officer to ascertain the average transport charges per maund of sugarcane from the purchasing centres to the assessee ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... onstruction of the Tariff Item. He clearly acted beyond and outside the mandate given to him by the Collector (Appeals). The Collector (Appeals), on his part, had also fallen into in error in upholding the Asstt. Collector's order which, as just seen, was beyond jurisdiction. The Collector (Appeals) further fell into error when he revised his views and held that the test of predominance was not relevant, considering that the facts and the available evidence had not changed between his first order and second order. 11. There is another decision which is also of relevance. This is a judgment of the Andhra Pradesh High Court in the case of N. Nagendra Rao & Co. v. State of Andhra Pradesh (1978) 42 STC 194. In that case the Sales Tax Appellate Tribunal, without going into the merits of an appeal filed by an assessee remanded the matter to the Assistant Commissioner with a direction that he should call for a report of the Commercial Tax Officer, but the Assistant Commissioner, on remand, dismissed the appeal without obtaining the report of the Commercial Tax Officer. The assessee again filed an appeal to the Tribunal which was heard by a Bench different from the first Bench. It observe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... from which an appeal lies does not appeal therefrom he shall thereafter be precluded from disputing its correctness. The High Court has misconceived the scope of its inherent powers. Under the inherent power of Courts recognised by S. 151, C.P.C., a Court has no power to do that which is prohibited by the Code. Inherent jurisdiction of the Court must be exercised subject to the rule that if the Code does contain specific provisions which would meet the necessities of the case, such provisions should be followed and inherent jurisdiction should not be invoked. In other words the Court cannot make use of the special provisions of Section 151 of the Code where a party had his remedy provided elsewhere in the Code and he neglected to avail himself of the same. Further the power under Section 151 of the Code cannot be exercised as an appellate power." 14. In the above view of the matter, the impugned order insofar as it concerns the classification of the goods cannot be upheld. The matter must go back to the Asstt. Collector who will proceed to have the sample of the goods produced before him in the remand proceedings tested. If, however, at this distant date, no sample is available ei ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ise in futility. It is, therefore, necessary to examine this contention notwithstanding the position that since the Asstt. Collector did not comply with the remand directions of the Collector (Appeals), the matters must go back to the Asstt. Collector. The Departmental Representative's reply to this contention is that the facts of the present dispute are distinguishable from those in the Geep Flashlight case before the Supreme Court. In that case, Item 15A(2) of the CET read as "articles made of plastics, all sorts, .....". In the present case, Item 16A read as 'Rubber products, the following, namely -' The concept of predominance is not, therefore, relevant. 16. In the Geep Flashlight case, the goods were described as plastic torches. The torch consisted of a body made of plastics with certain metal parts together with reflector and glass as its components. Item 15A(2) CET under which classification was sought by the petitioner read as follows : "Articles made of plastics, all sorts, including tubes, rods, sheets, foils, sticks, other rectangular or profile shape, whether laminated or not, and whether rigid or flexible, including layflat tubings, and polyvinyl chloride sheets... ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... material or otherwise. No similar words are to be found in Item 15A(2). Though we are conscious of the position that the words in 16A(2) should not be the basis for interpretation of the words in 16A(4), it cannot be overlooked that though the main heading is 'Rubber Products', the description of sub-item (2) takes within its ambit not only articles made wholly of rubber. The Collector (Appeals) was, in our opinion, therefore, right in concluding in his first order that the test of predominance was relevant. Whether it is decisive or not, we would leave to the Asstt. Collector who will be adjudicating the matter on remand. 17. In the light of the above discussion, we are of the opinion that the ratio of the Supreme Court's judgment in the Geep Flashlight case (supra) does not apply to the facts of the present case. We remand the matter to the Asstt. Collector for de novo determination in the light of the above observations and directions. This order disposes of C.O. No. 340/84 also. 18. Appeal No. 867/84-D. - The impugned order upholds the demand for duty but limits it to a period of six months preceding the date of issue of the show cause notice. The contention for the assessee ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on 41.1/84.D. - The Collector contends that the Collector (Appeals) was not correct in setting aside the demand for the period beyond six months from the date of the show cause notice. It is contended that there was material suppression on the part of the assessee with a view to evade duty due. 21. In our opinion, the Collector's order correctly sets out the reasons why the extended period of limitation of five years would not apply to the facts and circumstances of the present case. We are satisfied that his finding that the normal period of six months alone would apply in the present case is correct. We reject the Collector's contention in this behalf. 22. The cross objection seeks the only relief that the Collector's appeal be dismissed. We have dismissed the Collector's appeal. The "cross objection" thus stands disposed of. 23. Appeal Nos. 980 to 986/84-D. - These appeals are, as noted earlier, against the Superintendent's orders of assessment on the RT 12 Returns themselves for 7 months. The Counsel submitted with reference to these appeals that no show cause notices had been issued under Section 11A of the Central Excises & Salt Act in respect of demands for duty covered b ..... X X X X Extracts X X X X X X X X Extracts X X X X
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