9911796707
TMI Blog1983 (5) TMI 230X X X X Extracts X X X X X X X X Extracts X X X X ..... finished steel material. 3. According to the appellant, they have been manufacturing number of products at the said factory under AL-4 Licence which they held since 9-12-1968, but when sometime in 1976, an application was made, in the usual course, for renewal of the aforesaid licence, they were advised by the Assistant Collector, Jamshedpur vide his letter dated 16-2-1976 that although the licence in question had been renewed as requested by the Company, no licence was required as this Agrico Unit of the Company was exempt from having a licence as it was producing only forged products. It is averred that the company still wanted to be very clear and they again approached the Assistant Collector to grant them personal hearing as they felt that notwithstanding the fact that their products were exempt from duty, it was necessary to have their licence renewed but the Assistant Collector, Central Excise again by his letter dated 19-3-1977 so informed them that in view of Notification No. 31/76-C.E., dated 28-2-1976, iron and steel products which were exempt from payment of whole of the excise duty, were also exempt from the operation of Rule 174-A of the Central Excise Rules, and th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 26AA of the First Schedule of the Central Excise Act, 1944 and that their classification list filed by them had been approved in his regard and that there was no reason why simply because T.I. 68 came into force, their products should cease to be falling under Tariff Heading 26AA. It was further pleaded that the Assistant Collector had not passed any speaking order, inasmuch as whereas in respect of hammers, he held that they were forged products, covered by T.I. 26AA, as regards `coal-cutting picks and `harrow discs , he simply said that they fell under T.I. 68, without assigning any reasons. They also annexed copies of the R.T. 12 Returns, pertaining to the period before March 1975 in support of their plea that hammers and coal cutting picks have been described as forged products, falling under Tariff Entry No. 26AA. They also pleaded, in the alternative, that even if assuming, though, not admitting, that harrow discs fell under T.I. 68, they were otherwise exempt from payment of duty being agricultural implements, and further that the demand made by the Central Excise authorities by means of show cause notice was barred by limitation. 6. The Appellate Collector by means of h ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nce was required, had sought a further clarification, expressing the view that in spite of the exemption, renewal of the licence was necessary, but the Assistant Collector in categorical terms told them again, that in view of the statutory notification, he could not extend Excise Control to those products, and consequently the same was withdrawn. She further contended that even the classification Lists had been filed and approved for this period regarding which now allegations are levelled that goods had been cleared without payment of excise duty, and that there being no clandestine removal in any case, provisions of Rule 9(2) would not apply, and that period of six months only was available under Rule 10, and that the notice to show cause having been given for the first time on 13-2-1978, the demand for the entire period covered by the show cause notice, namely 1-3-1975 to 17-6-1977 was not enforceable. These arguments were addressed without prejudice to her main contention that the goods manufactured at the factory, known as Agrico, were all forged products and classifiable under T.E. 26AA, and Classification Lists for the period even after 1-3-1975 have been approved and she qu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... a large range and variety of implements primarily for agriculture and the main process is that of forging. There is also no controversion of the fact that the company has been filing classification lists throughout constantly showing all these products as forged products and the Department, till the time the show cause notice was issued, was accepting the said description and declaration, and processing the lists accordingly. We find that the Assistant Collector in fact has been intimating the appellants that their products squarely fell within the ambit of Exemption Notification No. 31/76 C.E., dated 28-2-1976 and went to the extent of telling them that he thought it to be a case where excise control had to be withdrawn and was being actually withdrawn. 11. In this setting of facts, it becomes incumbent upon the Revenue to give some cogent reasons for suddenly changing their view. The contention of the Appellants is supported by judicial authorities to the effect that although principles of Res Judicata may not apply to quasi judicial authorities but still the classification which has been accepted through the years cannot suddenly be rejected, and without any reasonable basis. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e being accepted. There is also a written communication under the signatures of the Factory Superintendent of the Agrico Department of the appellant giving the manufacturing process of these two products, which is on the file, and which shows that the process employed for manufacturing these two products, harrow discs and coal cutting picks, was that of forging and the rest of the operations, if any, are by way of finishing touches only. The catalogue which the appellant annexed with the appeal also reveals that all their products were result of forging process. That being so, and the show cause notice and the order of the Assistant Collector having failed to reveal the basis for change of opinion, and it also being factfully established that these two products were basically forged products, and in view of the authority of Patna High Court, namely Tata Yodogwa Limited v. Assistant Collector of Central Excise, Jamshedpur reported as 1983 E.L.T. 17 (Pat.) laying down that merely because some machining or polishing is being done of certain products, their basic character as casting could not alter; we find abundant justification in the appellants plea that the lower authorities comm ..... X X X X Extracts X X X X X X X X Extracts X X X X
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