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TMI Blog2016 (5) TMI 1066X X X X Extracts X X X X X X X X Extracts X X X X ..... way confirmed the demand under Section 11 A. Therefore, by respectfully, following the Apex Court decisions in the case of Metal Forgings Vs. UOI [2002 (11) TMI 90 - SUPREME COURT OF INDIA] and in the case of Gujarat Machinery Manufactures Ltd. Vs. CCE, Baroda [1996 (9) TMI 121 - SUPREME COURT OF INDIA], we find there is no demand in the SCN issued under Section 11 A for recovery or any short levy of duty on account of re-classification. The demand is not sustainable and is set aside. - Decided in favour of appellant - E/712/2007 - Final Order No. 41537/2015 - Dated:- 2-11-2015 - R. Periasami, Member (T) And P. K. Choudhary, Member (J) For the Appellant : Mr S Muthuvenkataraman, Adv For the Respondent : Mr B Balamurugan, AC (AR) ORDER Per R. Periasami The appellant filed appeal against the Commissioner (Appeals) order dated 31.07.2007. 2. The brief facts of the case are that the appellants are a PSU engaged in the manufacture of various lubricating oils falling under chapter 27 and 34 of the CETA, 1985. They have filed classification list in the year 1992 for various products and claimed exemption under Notifications No. 287/1986 as amended by No. 8/1992 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... proviso of Section under which the demand is proposed. In the absence of any such SCN, he submits that the adjudicating authority has gone beyond the SCN and confirmed the demand. The word mentioned in the SCN issued for re-classification is duty to be collected as per Rules and this cannot be construed as demand made under Section 11A. He relies on the decision of the Hon'ble Supreme Court in the case of Metal Forgings Vs. UOI - 2002 (146) ELT 241 (S.C.) and submits that the Hon'ble Supreme Court clearly laid down the principles and held that SCN is a mandatory requirement for raising any demand. He relied on the following decisions: 1. Balaji Vegetble products Pvt. Ltd. Vs. CCE, Kanpur - 1999 (108) ELT 802 (Tri.) 2. Bharati Shipyard Pvt. Ltd. Vs. CCE, Pune 1998 (101) ELT 33 (Tri.) 3. Total Security System Vs. CCE, Goa 2008 (10) STR 624 (Tri.-Mum) 4. CCE, Pondicherry Vs. J.K. Pharma Chem. Ltd. 2008 (226) ELT 749 (Tri.-Chen.) 5. Jeet Ram Enterprises Vs. CCE, Delhi 2006 (199) ELT 528 (Tri.) 6. Reliance Industries Ltd. Vs. CCE, Mumbai-III 1997 (93) ELT 213 (Tri.) 7. Gujarat Machinery Manufactures Ltd. Vs. CCE, Baroda - 1996 (87) ELT ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed by the appellants in their classification list filed with the department as per the procedure existed during the relevant period. We find that the adjudicating authority neither brought out any allegation in the said SCN for demanding duty. All that the said notice says is that why the classification of the products claiming nil rate of duty should not be rejected and duty collected as per rules . The said notice is silent on what classification heading the adjudicating authority is proposed to re-classify the products, nor any demand amount is specified. Whereas, in OIO, the adjudicating authority after re-classifying the goods denied exemption and confirmed the excise duty under Section 11A. 7. In this regard, the Hon'ble Supreme Court laid down the law in the case of Metal Forgings Vs. UOI (supra). The Apex Court had clearly held that SCN is mandatory for recovering the duty not paid/short paid or erroneously refunded. The relevant paragraph of the Apex Court decision is reproduced as under:- 10. It is an admitted fact that a show cause notice as required in law has not been issued by the Revenue. The first contention of the Revenue in this regard is that since t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tion or otherwise, call for and examine the record of any proceeding in which any decision or order has been passed under this Act or the rules made thereunder by a Central Excise Officer subordinate to him (not being a decision or order passed on appeal under Section 35) for the purpose of satisfying himself as to the correctness, legality or propriety of such decision or order and may pass such order thereon as he thinks fit. 3(a) No decision or order under this section shall be varied so as to prejudicially affect any person unless such person is given a reasonable opportunity of making a representation and, if he so desires, of being heard in his defence. (b) Where the Board or, as the case may be, the Collector of Central Excise is of opinion that any duty of excise has not been levied or has been short-levied or erroneously refunded, no order levying or enhancing the duty, or no order requiring payment of the duty so refunded, shall be made under this section unless the person affected by the proposed order is given notice to show cause against it within the time-limit specified in Section 11A. Sub-section (2) of Section 35A empowers a Collector of Central Exci ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on 11 A, it is mandatory for any recovery of duty not paid or short paid. There shall be a SCN demanding the recovery of duty under Section 11 A. In the present case, under no stretch of imagination, the alleged SCN can be construed as SCN issued under Section 11 A. The said SCN was primarily issued for re-classifying and denying exemption notification as per the classification list filed by the appellant under the erstwhile Rules. The adjudicating authority proposed to change the classification and denying exemption, there should be a clear demand issued under Section 11 A. Whereas, in the present case, neither SCN says so, on the contrary, the adjudicating authority after re-classifying the goods and denying exemption, straightaway confirmed the demand under Section 11 A. Therefore, by respectfully, following both the Apex Court decisions, we find there is no demand in the SCN issued under Section 11 A for recovery or any short levy of duty on account of re-classification. The citations relied by the Revenue in the case of NGP Industries Ltd. (supra) and Bihari Silk Rayon Processing Mills (supra) are not applicable to the present case, for the reason that in the above case laws ..... X X X X Extracts X X X X X X X X Extracts X X X X
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