9911796707
TMI Blog1990 (1) TMI 197X X X X Extracts X X X X X X X X Extracts X X X X ..... peal the dispute is regarding classification of this product only. The appellant's firm was registered as a Small Scale Unit and commenced production of this product in and around 1980-81. At that time it was covered under Tariff Item 15A(2) but were exempted from whole of the duty of excise by virtue of Notification No. 68/71, dated 29-5-1971. The said tariff item came to be reconstructed in the year 1982 whereby specified varieties of articles of plastic were classified under Tariff Item 15A(2) and the remaining articles were covered under T.I. 68 and accordingly the appellant's product was classifiable under T.I. 68. By virtue of Notification No. 182/82, dated 11-5-1982 this product was exempted from the whole of duty of excise. Even during the period between 1-4-1982 to 11-5-1982 also it was so exempted by virtue of Notification No. 105/80 as under this Notification such exemption was available to Small Scale manufacturers upto the value of clearance of Rs. 30 lakhs. As no duty was leviable, the manufacturer was also exempted from licensing provision; in view of Notification No. 111/78, dated 9-5-1978. The appellant was also under bona fide belief that it was not required to fi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 4. We have heard Shri D.A. Dave, learned advocate for the appellant and Shri A.S. Sunder Rajan, learned JDR for the respondent. 5. The learned Advocate submitted that the Department had accepted classification of product in question under T.I. 68 and on that basis had granted exemption to the appellant from licensing procedure as per letter dated May 1982 (Page 53 of Paper Book of Appeal No. 320/86-C). Thereafter there was no change in Tariff entry nor any change in process of manufacture by the appellant and so there were no circumstances which warranted any change in the classification by the Department. So the Department could not have changed the classification from T.I. 68 to T.I. 42. He further contended that if the Department felt that the classification was required to be revised then also it was incumbent upon the Department to issue show cause notice and then to adjudicate the matter. On factual side he submitted that in fact the product in question is not pilfer proof caps for packaging as defined in T.I. 42. He also relied upon Tariff Advice dated 3-1-1976 issued by Central Board of Excise and Customs. He also referred to Indian Standard Specification for pilfer proo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sifying the product under T.I. 42 the appellant has stated "Classification is sub judice". At page 63 is the classification list submitted by the appellant classifying the product under T.I. 42 wherein also it is stated as under :- re-produced at page 13 Para 6 of Appeal memo) "The above classification of Red Top Plate is not acceptable by us. Our contention of Top Plate fall under T.I. 68 and are exempted vide 182/82. This licence is taken under protest." As per endorsement it was approved by the Additional Collector on 17-8-1984 (Classification list is dated 10-8-1984). At page 62 is forwarding letter whereby the approved list was returned to the Appellant. It is not in dispute that no Show Cause Notice was issued to the appellant before finalising the classification list. Now when it was filed under protest and when the appellant insisted that there were no circumstances which warranted revision of classification and they were filing it under protest and as per instructions of the Department then it was incumbent upon the Department to issue Show Cause Notice and adjudicate matter in a proper manner. Classification, while the same is being disputed by the manufacturer becomes ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... m the cap as soon as it is unscrewed." So from the description in the trade notice and the Indian Standard Specification it is clear that cap which is covered under T.I. 42 must be of such a nature that it should completely seal the container. It cannot be opened without breaking the cap meaning thereby that it is specifically devised to make the container tamper-proof. The appellant has also relied upon two certificates issued by Sarabhai Research Centre and Alembic Chemical Works Co. Ltd. (Annexure P & Q in Paper Book). These are manufacturers who are using such caps and in their opinion the product of the appellant does not qualify to be pilfer proof cap. So from this it could be seen that the persons who are dealing with these products are of the opinion that the product does not answer to the description given in T.I. 42. The appellant has also relied upon the decision in Captocaps Pvt. Ltd. (Guj.) wherein it has been laid down as under:- "It is an accepted proposition that pilfer proof caps are those whereunder no circumstances the caps can be removed without leaving traces of the fact of the removal of the caps and should be considered in the sense in which it would be und ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... would answer the description provided in T.I. 42. So they cannot be faulted on that ground simply because it is the contention of the Department that product in question answers description in T.I. 42. The appellant cannot be expected to pre-judge the mind of the department or to presume that at some later date the Department would try to interpret the tariff item in a particular manner and that it would direct the appellant to classify the product under particular T.I. and so they should classify it in that manner before the Department raise any objection. This is a legal dispute and the appellant was within its rights to classify the product under T.I. 68. At that time it was open to the Department to inquire whether it was a fact and whether the product was correctly classifiable under T.I. 68 or T.I. 42. They had that opportunity at relevant time and they had accepted the classification suggested by the appellant, so the Department cannot turn around at a subsequent date and contend that whatever declared was not proper and thereby the manufacturer had suppressed the facts or mis-declared the product and thereby committed any fraud. We are surprised to note that after the appel ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
