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TMI Blog2010 (8) TMI 348X X X X Extracts X X X X X X X X Extracts X X X X ..... and the assessee now comes up with an alternative proposal to classify the goods under Chapters 11 and 15. This plea of the appellant cannot be entertained in view of the above ruling of the apex court in Warner Hindustan Ltd. v Collector, (1999 -TMI - 45233 - SUPREME COURT OF INDIA) Extended period of limitation - That decision of the Assistant Commissioner was rendered as early as on30-06-2000. Naturally, the appellant was emboldened to classify their products under the same Heading and they did so. They filed periodical returns showing payment of duty at ‘nil’ rate as applicable to SH 1905.90 during the period of dispute. There was no whisper against this self-assessment of the appellant, in the departmental circles. In this scenario, the plea of bona fide belief in favour of classification under Heading 19.05 appears to be cogent and valid. Therefore, it cannot be said that the appellant suppressed any material fact before the department with intent to evade payment of duty. The extended period of limitation, therefore, is not invokable in this case. - E/1452/2007 - A/265/2010-WZB/C-II/EB - Dated:- 19-8-2010 - S/Shri P.G. Chacko, S.K. Gaule, JJ. REPRESENTED BY : ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... uld only be done with reference to the terms of the Tariff Headings read with any relevant Chapter Notes or Section Notes. For want of alignment of the Tariff Headings with HSN Headings, no reliance could be placed on anything contained in the Explanatory Notes. The learned counsel has cited case law in support of the above contentions of the appellant. He has also referred to the process of manufacture of the goods as well as to the end-use, in support of the assessee s claim of classification under Heading 19.05. 3. It has also been pointed out that, in respect of similar products manufactured by their sister-unit (at Pune), the adjudicating authority accepted classification under Heading 19.05. It is submitted that the said decision of the Assistant Commissioner was never reviewed. In this connection, the learned counsel has also raised the plea of limitation against the demand of duty. It is submitted that a major part of the impugned demand of duty is beyond the normal period of limitation and that the extended period of limitation provided under Section 11A(1) was invoked without valid grounds. It is submitted that the appellant had always been maintaining the bona fide bel ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Tribunal and classification ordered under Heading 15.08 in respect of vegetable oil/fat-based cake-improvers and under Heading 11.01 in respect of flour-based bread-improvers. 5. Learned counsel has also objected to the valuation ordered by the Commissioner. Assuming, without conceding, classification of the goods under Heading 21.08, he submits that the goods cannot be assessed in terms of Section 4A of the Act by virtue of the exemption available under Rule 34(a) of the Standards of Weights and Measures (Packaged Commodities) Rules, 1977. According to the learned counsel, as the goods in question were specially packed for industrial use and this aspect was clearly indicated on the product labels, they were exempted, under Rule 34, from the operation of other provisions of the said Rules with the result that Section 4A of the Central Excise Act was not applicable to the goods. In this connection also, the learned counsel has cited case law. 6. In the absence of suppression of facts with intent to evade payment of duty, it was not open to the adjudicating authority to impose any penalty on the appellant under Section 11AC of the Central Excise Act. 7. Learned Special Consulta ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... as follows : 19.05 Bread, pastry, cakes, biscuits and other bakers wares, whether or not containing cocoa, communion wafers, empty cachets of a kind suitable for pharmaceutical use, sealing wafers, rice paper and similar products. 1905.10 - Crispbread 1905.20 - Gingerbread and the like - Sweet biscuits; waffles and wafers : 1905.31 - Sweet biscuits 1905.32 -- Waffles and wafers 1905.40 -- Rusks, toasted bread and similar toasted products 1905.90 - Other The description of the main Headings in the Tariff and the HSN are identical. But, when it comes to sub-headings, one can see significant differences. Under Tariff Heading 19.05, the main sub-headings are Biscuits; Cakes and Pastry; Waffles and Wafers; and other (vide single dash). On the other hand, the main sub-headings under HSN Heading 19.05 are Crispbread; Gingerbread and the like; Sweet Biscuits; Waffles and Wafers; Rusks, Toasted Bread and similar toasted products; other (vide single dash). In this scheme of c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... shown that the expression edible preparations is synonymous with food preparations . More conspicuously, while residuary food preparations are classified under two sub-headings of HSN Heading 21.06; residuary edible preparations get classified under as many as six sub-headings of Tariff Heading 21.08. Protein concentrates and textured protein substances classified under SH 2106.10 of HSN Heading 21.06 do not figure anywhere under Tariff Heading 21.08. If this is the case with sub-headings covering specific description of goods, we shudder to think, how could the Revenue align the residuary sub-heading 2108.99 of Tariff Heading 21.08 with the residuary sub-heading (2106.90) of HSN Heading 21.06. In our view, by no stretch of imagination can one say that classification under Tariff heading 21.08 is aligned with that under HSN heading 21.06. The case law cited by the learned counsel in this context is to the effect that, where Tariff classification of goods is not aligned with the HSN, no reliance can be placed on HSN Explanatory Notes in the context of classifying excisable goods under the Tariff vide Camlin Ltd. v. CCE - 2008 (230) E.L.T. 193 (S.C.). As rightly poin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ements of responsible functionaries of the company. We have also seen some of these statements on record. These statements contain specific averments which would constitute some basis for classification of the bakery improvers. The show-cause notice relied on these statements. It also relied on relevant provisions of the Tariff entries themselves. If the proposal in the show-cause notice to classify the goods under Heading 21.08 can independently stand on these materials, there is no reason to hold that the of Revenue has no case in the show-cause notice shorn of all references to HSN provisions. The suggestion to the contra, made by the learned counsel, is not acceptable. (b) Whether the Assistant Commissioner s order of classification of similar goods of the appellant s sister-unit at Pune would operate as res judicata ? Our considered answer is no, as we are supported by binding judicial authorities. In the case of Swaraj Mazda Ltd. v. CCE, 1995 (77) E.L.T. 505 (S.C.), the Hon ble Supreme Court held that this Tribunal was not precluded from deciding certain question on merits because of earlier decision relating to an earlier period. The adjudicating authority at Pune mi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e, certain vegetable oil/fat-based cake improvers were classified under heading 15.08 and held not classifiable under Heading 21.08. Similarly, certain flour-based bread improvers were classified under heading 11.01 and held not classifiable under heading 21.08. The decision was rendered in appeals filed by the party against an order of the Commissioner (Appeals) classifying the goods under SH 2108.99. The appellate Commissioner s order was relied on in the show-cause notice involved in the present case, wherein the department described the bakery improvers of the appellant as exactly similar to the products of M/s. Helios Food Additives Pvt. Ltd. Before us, both sides at the bar have accepted the products of M/s. Helios Food Additives Pvt. Ltd. and the bakery improvers of the appellant to be exactly similar products . Nevertheless, the learned consultant for the Revenue has made an attempt to distinguish the case of Helios Food Additives (supra) vis-a-vis the appellant s alternative plea for classification of the subject goods under Chapter 11/15. We are not impressed with his bid to distinguish the two cases in this manner inasmuch as the subject goods were acknowledged to be ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... kages of 1 kg each. It is submitted that each of such smaller packages was labelled with the description of the goods as well as MRP. The learned counsel has not accepted these factual submissions in to. In this scenario, we are of the view that the applicability of Rule 34(a) or other relevant rules to the subject clearances needs to be determined after proper verification of facts, which again calls for a remand of the matter to the adjudicating authority. (f) Whether the extended period of limitation is applicable in this case? Learned counsel has been able to make out a good case on this front. It is not in dispute that a sister-unit of the appellant, at Pune, was also manufacturing and clearing similar products and that the classification thereof was determined by the Assistant Commissioner under Heading 19.05 and further that his decision was not reviewed by the department. That decision of the Assistant Commissioner was rendered as early as on30-06-2000. Naturally, the appellant was emboldened to classify their products under the same Heading and they did so. They filed periodical returns showing payment of duty at nil rate as applicable to SH 1905.90 during the p ..... 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